2. CONSUMER BEHAVIOUR
• Behaviors that consumers display in searching for,
purchasing, using, evaluating and disposing of
products and services.
• Focused on how an individual consumers or
households make decisions to spend their available
resources ( Time, Money, Effort ) on consumption
related items.
• Study of When, Why, How and Where people do or
do not buy a product.
• A blend of psychology, Sociology, Social anthropology
and economics.

3. CONSUMER BEHAVIOUR AND
MARKETING

4. • Marketing is the art and science of influencing
consumer behaviour.
• Every aspect of marketing is tied to consumer
behaviour.
• Marketer need to understand the psychology of the
consumers.
• Customer value is the difference between all the
benefits derived from a total product and all the costs
of acquiring those benefits.
• Customer value requires the organisation to do a
better job of anticipating and reacting to customer
needs than the competitor.

5. • Buying behaviour includes
 Recognition of the problem (need to be met)
search for information
consideration of alternatives
purchase, consumption, disposal
• Marketers must be aware of the buying process
and consumer influences to be effective in
appealing to, and meeting consumer needs
• Marketers should also aim to create value in the
mind of the consumer by understanding what the
consumer values

7. MARKET SEGMENTATION
• Finding out what kind of consumers with
different needs exist.
• Consumers grouped according to their similar
needs and characteristics.
• These market segments are described in terms
of demographic, geographic location and
media preferences.

9. TARGETING
• Preferred segment based on ability to meet
the needs of this group.
• Choice depends on
• How well the segment is served by other
manufacturers ?
• How large is the segment
• Do the organisation has the strength to appeal
to a particular group of consumers.

10. POSITIONING
• How consumers perceive your product in
relation to others in the market
• Achieved through understanding the
customers and applying relevant marketing
mix strategies

11. MARKETING STRATEGY
• How an organisation will provide superior
customer value to a target market
• This requires the formulation of consistent
marketing mix which includes
 Product
 Price
 Promotions
 Place
 Service

12. THE PRODUCT
• Product is anything a consumer acquires or
might acquire to meet a perceived need
• Consumers generally buy for need satisfaction
not for physical product attributes.

13. PRICE
• Price is the amount of money paid to obtain
the right to use the product.
• Price sometimes serves as a signals of quality.

14. PROMOTION
• Marketing promotions includes advertising,
sales force, public relations packaging and any
other signals that the firm provides about
itself and the product.

15. DISTRIBUTION
• Distribution means having the product available where target
customers can buy it. This is essential to the product’s success.
• Good channel decision requires a sound knowledge of where
target customers shop for the product.

16. CONSUMER BEHAVIOUR AND ADVERTISING

17. Factors affecting consumer behavior
• Cultural and social • Psychological
influences influences
– Culture – Perception
– Social Class – Learning
– Reference groups – Motives
– Family – Attitudes
– Demographics – Lifestyles
– Geography

18. Cultural and social influences
• Culture
– Based on norms and values
• Norms – boundaries a culture establishes for behavior
• Values - broad preferences concerning appropriate
courses of action or outcomes
– Directly influences buying behavior

19. Cultural and social influences
• Social Class
– Determined by factors like income , wealth,
education, occupation, family prestige, value of
home, and neighborhood
– It is assumed that people in one class buy
different products for different reasons.

20. Cultural and social influences
• Reference Groups
– Collection of people used as a guide for behavior
in specific situations.
– Reference groups have three functions
• They provide information
• They serve as comparison
• They offer guidance

21. Cultural and social influences
• Family
– Family consists of two or more people who are
related by blood, marriage or adoption and live in
the same household.
– Family helps develop a lifestyle (how you spend
time and money and the kinds of activities you
value)

22. Cultural and social influences
• Demographics
– Are statistical, personal, social and economic
characteristics of a population including
• Age
• Gender
• Education
• Income
• Occupation
• Race/ ethnicity

23. Cultural and social influences
• Geographic location
– Difference in buying behavior exists between
different regions
– Buying behavior also differs urban areas and rural
areas.

24. Psychological Influences
• Perception
– The process by which we receive information
through our five senses and assign meaning to it.
• 3 sets of influences shape perception
– The physical characteristics of the stimuli
– The relationship of the stimuli to the surroundings
– The person’s state of mind.
• Some stimuli are selected over others
• Selective perception
– Screening out some information that does not interest us and
retaining that information that interests us.

25. Psychological Influences
• Selective exposure
– Seeking information that is in line with our beliefs, values,
experiences, biases, attitudes.
• Selective distortion
– Changing the meaning of information that is conflicting with
our beliefs
• Selective retention
– The process we go through to retain information

26. Psychological Influences
A little exercise

27. Activity - Perception

28. Activity - Perception

29. Activity - Perception

30. Activity - Perception

31. Activity - Perception

32. Activity - Perception

33. Activity - Perception

34. Activity - Perception

35. Activity - Perception

36. Activity - Perception

37. Activity - Perception

38. Activity - Perception

39. Activity - Perception

40. Activity - Perception

41. Activity - Perception

42. Activity - Perception

43. Activity - Perception

44. Activity - Perception

45. Activity - Perception
• Write down the ads which you remember.
• Write the reason for remembering every add.
• Discuss in class.

46. Psychological Influences
• Learning
– Perceptions lead to learning
– We learn something that we perceive and attach
meaning to it.
– Cognitive learning
• Perception -> Problem solving -> Insight
– Behavioral conditioning
• Classic conditioning
– Pairing one stimulus with another that already is
associated with a response
– e.g. associating sound of bell with end of school day
• Operant conditioning
– Voluntary occurrences of behavior that are then
rewarded , ignored or punished.

48. When you use a mobile while you drive, your head is somewhere else

49. Psychological Influences
• Motivation and Needs
– Motive
• An internal force that forces you to behave in a particular
way.
• Advertisers study buying motives.
– Need
• Basic forces that motivate us to do something
• Primary needs: requirements to maintain life
• Secondary: Acquired needs in response to our culture and
environment.
• Needs change over time.

50. When did you last buy and why?

51. Psychological Influences
• Attitudes
– A learned feeling you hold towards an object, a person
or an idea that leads to a particular behavior.
– Attitudes are resistant to change.
– Attitudes are learned, hence can be changed or
replaced.
– Attitudes may be positive or negative, weak or strong.

52. Psychological Influence
• Lifestyle
– The way a person spends his time and money and
the activities he likes to perform.

53. Role of consumer Behavior in
Advertising
• Advertisements play an essential role in creating an image of
a product in the minds of consumers.
• Advertising is basically a type of communication.
• It attempts to persuade potential customers to purchase or
consume a product or service.
• It is designed in such a way that it creates and reinforces
brand image and brand loyalty.
• Advertisements must be catchy and communicate relevant
information to consumers.

54. Contd…
• Understanding the needs of the consumer is really important
when it comes to creating the right advertisement for the
right audience.
• Advertising is usually important for triggering the first time
purchase of the product.
• it is only through advertisements; individuals are able to
connect with your brand.
• Identify your target audience. The advertisement in some way
must touch the hearts of the end-users for them to buy the
product.
• The advertisement must show what the product is all about. It
should, in a way give some kind of information about its price,
benefits, usage, availability.

55. • Mercedes, I phone advertisement ought to be classy
for people to recognize these products as status
symbols.
• Advertisements meant for younger people (college
goers, young professionals) ought to be colourful and
trendy for them to be able to relate themselves with
the product.
• Advertisements for insurance plans, medical
benefits, hospitals ought to be sensible as they
convey much serious information and target a
mature segment of individuals altogether.