Boundless Business: "Consumer Purchasing Behavior"

Consumer Purchasing Behavior

Consumer behaviour is the study of when, why, how, and where people do or do not buy a product.

Learning Objective

  • Outline the steps in the consumer purchasing process


Key Points

  • Consumer behaviour is the study of when, why, how, and where people do or do not buy a product. It blends elements from psychology, sociology, social anthropology and economics. It attempts to understand the buyer decision making process, both individually and in groups. It studies characteristics of individual consumers such as demographics and behavioural variables in an attempt to understand people's wants. It also tries to assess influences on the consumer from groups such as family, friends, reference groups, and society in general.
  • Customer behaviour study is based on consumer buying behaviour, with the customer playing the three distinct roles of user, payer and buyer.
  • Consumers compare the brands and products that are in their evoked set. How can the marketing organization increase the likelihood that their brand is part of the consumer's evoked set? Consumers evaluate alternatives in terms of the functional and psychological benefits that they offer. The marketing organization needs to understand what benefits consumers are seeking and therefore which attributes are most important in terms of making a decision. It also needs to check other brands of the customer's consideration set to prepare the right plan for its own brand.
  • Sometimes purchase intention does not result in an actual purchase. The marketing organization must facilitate the consumer to act on their purchase intention. The organization can use a variety of techniques to achieve this. The provision of credit or payment terms may encourage purchase, or a sales promotion such as the opportunity to receive a premium or enter a competition may provide an incentive to buy now.
  • There are 5 stages of a consumer buying process. They are: The problem recognition stage, meaning the identification of something a consumer needs. The search for information, which means you search your knowledge bases or external knowledge sources for information on the product. The possibility of alternative options, meaning whether there is another better or cheaper product available. The choice to purchase the product and then finally the actual purchase of the product.

Terms

  • Extensive Decision Making Buying Behavior

    This purchasing behavior relates to items that are bought rarely. They require planning and the decision can include input from websites, stores, friends, company personnel, etc.

  • Routine Response Purchasing Behavior

    This purchasing behavior occurs with items that are bought frequently and do not require a high level of decision making.

  • Selective retention consumers

    Selective retention consumers remember messages that are more meaningful or important to them.

  • Selective comprehension consumers

    Selective comprehension consumers interpret messages in line with their beliefs, attitudes, motives and experiences

  • Selective attention consumers

    Selective attention consumers select which promotional messages they will pay attention to.

  • Limited Decision Making Purchasing Behavior

    This purchasing behavior relates to items that are bought occasionally. There is more thought put into the decision than with routine responses, but there is not a high level of thought and time that goes into the purchase.

  • Selective exposure consumers

    Consumers who select which promotional messages they will expose themselves to.

  • Integration

    The relevant internal psychological process that is associated with a purchase decision


Examples

  • Examples of Social Functions: Decisiveness, neutrality, anonymity, monotonicity, unanimity, homogeneity and weak and strong Pareto optimality.
  • Routine Response Purchasing Behavior: Examples of items purchased include soft drinks and candy bars.
  • Limited Decision Making Purchasing Behavior: examples include clothing and games.
  • Extensive Decision Making Purchasing Behavior: examples include cars, apartments, and electronic equipment.

Consumer behaviour is the study of when, why, how, and where people do or do not buy a product. It blends elements from psychology, sociology, social anthropology and economics. It attempts to understand the buyer decision making process, both individually and in groups. It studies characteristics of individual consumers such as demographics and behavioural variables in an attempt to understand people's wants. It also tries to assess influences on the consumer from groups such as family, friends, reference groups, and society in general. Customer behaviour study is based on consumer buying behaviour, with the customer playing the three distinct roles of user, payer and buyer. Research has shown that consumer behavior is difficult to predict, even for experts in the field. Relationship marketing is an influential asset for customer behaviour analysis as it has a keen interest in the re-discovery of the true meaning of marketing through the re-affirmation of the importance of the customer or buyer. A greater importance is also placed on consumer retention, customer relationship management, personalisation, customisation and one-to-one marketing. Social functions can be categorized into social choice and welfare functions.Each method for vote counting is assumed as social function but if Arrow's possibility theorem is used for a social function, social welfare function is achieved. Some specifications of the social functions are decisiveness, neutrality, anonymity, monotonicity, unanimity, homogeneity and weak and strong Pareto optimality. No social choice function meets these requirements in an ordinal scale simultaneously. The most important characteristic of a social function is identification of the interactive effect of alternatives and creating a logical relation with the ranks. Marketing provides services in order to satisfy customers. With that in mind, the productive system is considered from its beginning at the production level, to the end of the cycle, the consumer.
 
Selective exposure consumers select which promotional messages they will expose themselves to. Selective attention consumers select which promotional messages they will pay attention to. Selective comprehension consumer interpret messages in line with their beliefs, attitudes, motives and experiences. Selective retention consumers remember messages that are more meaningful or important to them.The implications of this process help develop an effective promotional strategy, and select which sources of information are more effective for the brand.
 
Information evaluation: At this time the consumer compares the brands and products that are in their evoked set. How can the marketing organization increase the likelihood that their brand is part of the consumer's evoked set? Consumers evaluate alternatives in terms of the functional and psychological benefits that they offer. The marketing organization needs to understand what benefits consumers are seeking and therefore which attributes are most important in terms of making a decision. It also needs to check other brands of the customer's consideration set to prepare the right plan for its own brand. Once the alternatives have been evaluated, the consumer is ready to make a purchase decision. Sometimes purchase intention does not result in an actual purchase. The marketing organization must facilitate the consumer to act on their purchase intention. The organization can use a variety of techniques to achieve this. The provision of credit or payment terms may encourage purchase, or a sales promotion such as the opportunity to receive a premium or enter a competition may provide an incentive to buy now. The relevant internal psychological process that is associated with purchase decision is integration. Once the integration is achieved, the organization can influence the purchase decisions much more easily. There are 5 stages of a consumer buying process they are: 

  1. The problem recognition stage, meaning the identification of something a consumer needs. 
  2. The search for information, which means you search your knowledge bases or external knowledge sources for information on the product. 
  3. The possibility of alternative options, meaning whether there is another better or cheaper product available. 
  4. The choice to purchase the product.  
  5. And then finally, the actual purchase of the product. 
This shows the complete process that a consumer will most likely, whether recognisably or not, go through when they go to buy a product.


Last modified: Wednesday, February 7, 2018, 12:55 PM