Consumer Behavior- Introductory Concepts

Consumer Behavior
Prof. Dr T. Nagaprakash,
Associate Professor, Dept. Of
Management, Sri Ramakrishna
College of Arts and Science

Introduction to Consumer Behaviour
• Learning Objectives
 Nature and scope of consumer behaviour
 Application of consumer behaviour principles to strategic marketing
 Characteristics of worldwide consumers
 Special characteristics of Indian consumers
 Distinctive characteristics of Indian rural customers
 Simple five-stage consumer decision process

Who is a Consumer?
 A consumer is a person or an organizational unit that plays a role in
the consumption of a transaction with the marketer or an entity.
The term consumer refers to both the household and the business
markets.
 The five main buying roles are as follows:
1. The initiator – the person who decides to start the buying process.
2. The influencer – the person who tries to convince others that they
need the product.
3. The decider – the person who makes the final decision to
purchase.
4. The buyer – the person who is going to pay
5. The user – the person who ends up using your product, whether
he had a say in the buying process or not

Consumer behaviour refers to those acts of individuals that are
directly involved in obtaining and using economic goods and
services, including the decision processes that precede and
determine these acts (Engel et al.,1995) .
What is Consumer Behaviour?

 The knowledge of consumer’s needs, wants, attitude, and beliefs helps firms to
improvise their marketing strategies by understanding issues such as:
 how the consumers think, feel, comprehend, and select amongst
various competing brands;
 how they are influenced by their environment (e.g., culture, family,
signs, media);
 what is the pattern of shopping behaviour they are exposed to;
 what are their motivational parameters;
 how their decision strategies differ between products that differ in
their perceived level of importance.
 These understandings help the marketers to adapt and improve their
marketing campaigns and strategies to more efficiently reach the
consumer.

Important changes in the nature of the modern consumers
 Movement from collectivism to individualism
 Trade up and trade down and value vaulters
 Focus on health and fitness
 Increased consumer assertiveness
 Boom in online shopping

Characteristics of Indian Consumers
 India is a huge country with 28 states, over one billion
populous and 120 dialect/languages.
 The Indians consist of diverse segments of consumers,
depending on the various social classes, place of inhabitancy,
caste, race, and various other spectra.
 The Indian consumers have a towering scale of value
orientation, which projects them as one of the most
sensitive consumers in the world.
 Indian consumers have high degree of family orientation

Different Segments of Indian Consumers
 The Socialites
 The Conservatives
 The Working Women
 Indian Rich
(a) The rich
(b) The super rich
(c) The ultra rich
(d) The sheer rich
(e) The Obscenely rich

Indian Rural Consumers of 21st Century
Change in Purchasing Pattern
 The rural market grown in quantitative as well as
qualitatively too it has undergone a significant change.
 Trends indicate that the rural markets are coming up in a
big way and growing twice as fast as the urban markets,
witnessing a rise in sales of hitherto typical urban kitchen
gadgets such as refrigerators, mixer–grinders, and
pressure cookers.
 Even in lifestyle products, rural India shows a trend to be
significant over the next five years.

Reasons for Changing Purchase Patterns in Rural India
 Increase in the agricultural output
 Growth in Education
 Exposure to Mass Media
 Innovative pricing and non-conventional
distribution
 Growing interaction with the urban consumers

Impact of change in consumers’ profile on the Marketing Decisions
 Increase in online marketing
 Increasing celebrity endorsements
 More quality oriented outlets
 More sales promotion offers
 Inclination towards eco-friendly and herbal
products

The Application of Consumer Behaviour Principles to Marketing
To decide: (Product related)
 What task does this product or service dish up for the consumers in a
target market? And what does it signify to them?
 What attributes or features of the product are most significant to the
target market?
 What types of packaging and labelling information would best dole out
consumers and draw them to purchase the product? What brand name
and trademark for the product would generate the appropriate image in
the target market?
 What kinds of pre-sales or post sales services would gratify
consumers in the target market?
 How many models, variations, or sizes of the product are needed to
gratify various target markets?

To decide: (Price related)
 How much are the consumers in a target market ready to pay for a
particular product?
 At what price would consumers in this market judge this product is of
worth?
 What do specific prices correspond to consumers about the quality of a
particular product?
 If the price of a product were lowered in the short run, would consumers
carry on to buy the product when it reverts to full price?
 Would consumers stop purchasing the product if the price were
increased enduringly?
 How significant is price to consumers in a fastidious target market?

To decide: (Promotion related)
 What are the finest media for reaching a target market for a
particular product?
 What image should advertising try to craft about a product?
 What types of sales promotions would be most effectual for getting
customers to buy a product?
 What should be the salespeople’s approach to match consumers’
needs and wants with particular products?
 What task should publicity perform in communicating with
customers about a product?

To decide: (Place related)
 Would consumers have a preference to purchase a product
in stores or from different channels, such as mail-order
catalogues or store sales people?
 What reflection does various stores and chains have that
might influence consumer preference and purchase
behaviour for various products?
 Do various stores have particular environment that might
influence consumer purchase of a product?

The Simple Five Stage Consumer Decision Process

Consumer Behavior- Introductory Concepts

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