Consumer Buying Behaviour Analysis

Consumer Buying Behaviour Analysis CONSUMER BUYING BEHAVIOUR Consumer is the king and it is the consumer determines what a business is, therefore a sound marketing programme start with a careful analysis of the habits, attitudes, motives and needs of consumers. In particular a marketer should find answer to the following questions: What are the products they buy? Why they buy them? How they buy them? When they buy them ? Where they buy them? How often they buy them? A buyer makes a purchase of a particular product or a particular brand and this can be termed â€Å" product buying motives† and the reason behind the purchase from a particular seller is â€Å" patronage motives† When a person gets his pay packet, and if he is educated ,sits down along with his wife and prepares a family budget, by appropriating the amount to different needs. It may happen that after a trip to the market, they might have purchased some items, which are not in the budget, and thus there arises a deviation from the budgeted items and expenditure. all the behaviour of human beings during the purchase may be termed as â€Å"buyer behaviour†. HOW CONSUMER BUY 1. Need/Want/Desire is Recognized In the first step the consumer has determined that for some reason he/she is not satisfied (i.e., consumers perceived actual condition) and wants to improve his/her situation (i.e., consumers perceived desired condition). For instance, internal triggers, such as hunger or thirst, may tell the consumer that food or drink is needed. External factors can also trigger consumers needs. Marketers are particularly good at this through advertising, in-store displays and even the intentional use of scent (e.g., perfume counters). 2. Search for Information Assuming consumers are motivated to satisfy his or her need, they will next undertake a search for information on possible solutions. The sources used to acquire this information may be as simple as remembering information from past experience (i.e., memory) or the consumer may expend considerable effort to locate information from outside sources (e.g., Internet search, talk with others, etc.). How much effort the consumer directs toward searching depends on such factors as: the importance of satisfying the need, familiarity with available solutions, and the amount of time available to search. 3. Evaluate Options Consumers search efforts may result in a set of options from which a choice can be made. It should be noted that there may be two levels to this stage. At level one the consumer may create a set of possible solutions to their needs (i.e., product types) while at level two the consumer may be evaluating particular products (i.e., brands) within each solution. For example, a consumer who needs to replace a television has multiple solutions to choose from such as plasma, LCD and CRT television. 4. Purchase In many cases the solution chosen by the consumer is the same as the product whose evaluation is the highest. However, this may change when it is actually time to make the purchase. The â€Å"intended† purchase may be altered at the time of purchase for many reasons such as: the product is out-of-stock, a competitor offers an incentive at the point-of-purchase (e.g., store salesperson mentions a competitors offer), the customer lacks the necessary funds (e.g., credit card not working), or members of the consumers reference group take a negative view of the purchase (e.g., friend is critical of purchase). 5. After-Purchase Evaluation Once the consumer has made the purchase they are faced with an evaluation of the decision. If the product performs below the consumers expectation then he/she will re-evaluate satisfaction with the decision, which at its extreme may result in the consumer returning the product while in less extreme situations the consumer will retain the purchased item but may take a negative view of the product. Such evaluations are more likely to occur in cases of expensive or highly important purchases. To help ease the concerns consumers have with their purchase evaluation, marketers need to be receptive and even encourage consumer contact. Customer service centers and follow-up market research are useful tools in helping to address purchasers concerns. TYPES OF CONSUMER PURCHASE BEHAVIOR Consumers are faced with purchase decisions nearly every day. But not all decisions are treated the same. Some decisions are more complex than others and thus require more effort by the consumer. Other decisions are fairly routine and require little effort. In general, consumers face four types of purchase decisions: * Minor New Purchase these purchases represent something new to a consumer but in the customers mind is not a very important purchase in terms of need, money or other reason (e.g., status within a group). * Minor Re-Purchase these are the most routine of all purchases and often the consumer returns to purchase the same product without giving much thought to other product options (i.e., consumer is brand loyalty). * Major New Purchase these purchases are the most difficult of all purchases because the product being purchased is important to the consumer but the consumer has little or no previous experience making these decisions. The consumers lack of confidence in making this type of decision often (but not always) requires the consumer to engage in an extensive decision-making process.. * Major Re-Purchase these purchase decisions are also important to the consumer but the consumer feels confident in making these decisions since they have previous experience purchasing the product. For marketers it is important to understand how consumers treat the purchase decisions they face. If a company is targeting customers who feel a purchase decision is difficult (i.e., Major New Purchase), their marketing strategy may vary greatly from a company targeting customers who view the purchase decision as routine. In fact, the same company may face both situations at the same time; for some the product is new, while other customers see the purchase as routine. The implication of buying behavior for marketers is that different buying situations require different marketing efforts Consumer Buying Decision Process â€Å"Nothing is more difficult and therefore, more precious, than to be able to decide is quoted to be the words of Napoleon. This is amply true in the case of consumer too. It is for this reason that the marketers are bound to have a full knowledge of the consumer buying decision process. However it should be remembered that the actual act of purchasing is only one stage in the process and the process is initiated at the several stages prior to the actual purchase. Secondly even though we find that purchase is one of the final links in the chain of process, not all decision processes lead to purchase. The individual consumer may terminate the process during any stage. Finally not all consumer decisions always include all stages. Persons engaged in extensive decision making usually employ all stages of this decision process. Where as those engaged in limited decisions making and routine response behaviour may omit some stages. The consumer decision process is composed of two parts, the process itself and the factors affecting the process. SURVEY BY THE MARKETING TEAM A survey conducted by the marketing team of shoppers stop Ltd. Reveals the psychography of the modern shopper. Acordingly the survey classifies customers in to the four segments namely * Convenience Shoppers * Value Shoppers * Image Shoppers * Experience Shoppers Convenience shoppers for instance ,are people who consume relatively less amount of time while shopping. Also they look out for the width and depth of the range they purchase and conduct their annual shopping at one shot. Value Shoppers always hunt for value for money ; Prefer quality reassurance and benchmark offerings among other related attributes. Image Shoppers are fashion- conscious and look out for the latest trends and labels. On the other hand , Experience Shoppers are attentive and prefer personalized services look out for the right ambience, prefer giving personal advice on clothing at the time of purchase , and prefer not to buy at one sold. ECONOMIC FACTOR AFFECT THE BUYERS BEHAVIOUR 1.Disposal personal income : The economists made attempts to establish a relationship between income and spending. Disposal personal income represents potential purchasing power that a buyer has. The change in income has a direct relation on buying habits. 2.Size of family income : The size of family and size of family income affect the spending and saving patterns. Generally large family spend more and short family spend less, in comparison. 3. Income expectations : The expected income to receive in future has a direct relation with the buying behaviour. The expectation of higher or lower income has a direct effect on spending plans. 4.Propensity to consume and to save : This goes to the habit of spending or saving with the disposal income of buyers. If the buyers give importance to present needs, then they dispose of their income. And buyers spend less if they give importance to future needs. 5. Liquidity of Fund : The present buying plans are influenced greatly by liquidity of assets i.e., cash and assets readily convertible into cash, eg bonds, bank balances etc., 6. Consumer Credit : â€Å" Buy now and pay later† plays its role effectively in the rapid growth of markets for car, scooter, radio, furniture and the like. Economic model suggests behavioural hypothsis : * Lower the price of the product, higher the sales. * Lower the price of substitute products, lower the sales of this product * Higher the real income, higher the sales of the product. * Higher the promotional expenses, higher the sales. Internal influences of buyers * psychographics (lifestyle), * personality, motivation, knowledge, * attitudes, * beliefs, and * feelings. * demographics, consumer behaviour concern with consumer need consumer actions in the direction of satisfing needs leads to his behaviour behaviour of every individuals depend on thinking process. EXTERNAL INFLUENCES OF BUYERS * culture, * sub-culture, * Locality, * royalty, * ethnicity, * family, * social class, * reference groups, * lifestyle, and * market mix factors.