Consumer Behaviour

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Chapter 1 INTRODUCTION

Consumer is the study of the processes involved when individuals or groups select, purchase, use, or dispose of products, services, ideas, or experiences to satisfy needs and desires (Solomon 1995, 7). In the marketing context, the term consumer refers not only to the act of purchase itself, but also to patterns of aggregate buying which include pre-purchase and post-purchase activities. Pre-purchase activity might consist of the growing awareness of a need or want, and a search for and evaluation of information about the products and brands that might satisfy it. Post-purchase activities include the evaluation of the purchased item in use and the reduction of any anxiety which accompanies the purchase of expensive and infrequently-bought items. Each of these has implications for purchase and repurchase and they are amenable in differing degrees to marketer influence (Foxall 1987). Engel, et al. (1986, 5) define consumer behaviour as those acts of individuals directly involved in obtaining, using, and disposing of economic goods and services, including the decision processes that precede and determine these acts. Simple observation provides limited insight into the complex nature of consumer choice and researchers have increasingly sought the more sophisticated concepts and methods of investigation provided by behavioural sciences in order to understand, predict, and possibly control consumer behaviour more effectively. Psychology, social psychology, and sociology are the disciplines most widely employed in this endeavour which has become a substantial academic industry in its own right. In order to develop a framework for the study of consumer behaviour it is helpful to begin by considering the evolution of the field of consumer research and the different paradigms of thought that have influenced the discipline (Marsden and Littler, 1998). Paradigms in consumer research can be broadly classified as a set of fundamental assumptions that researchers make about what they are studying and how they study it (Kuhn, 1962). As described below, a set of dimensions can be isentified in the literature, which can be used to characterise and differentiate, the various perspectives on consumer behaviour. Consumer behaviour itself emerged as a distinct field of study in the 1960s. A major catalytic influence in its emergence was the formation of the Association for Consumer Research in 1969. Membership now exceeds 1700 (www.acrweb.org), and the growing maturity of the field is reflected in its annual conference proceedings, entitled Advances in Consumer Research. The literature has grown sharply, with the Journal of Consumer Research (first published in 1974) standing as a premier source. More recently, the Journal of Consumer Psychology was launched in 1992. Consumer Behaviour: A Literature Review 321 During the process of evolution of the field of consumer behaviour, researchers drew on various disciplines, ranging from psycho-physiology to literature (Solomon 1995). A list of professional associations 2 that sponsor the Journal of Consumer Research provides a glimpse of the number of disciplines working together in the field. The diverse disciplines employed by researchers

approach consumer issues from different perspectives. In addition to the many disciplinary orientations, perspectives on consumer behaviour are broadly differentiated by their emphasis on internal influences (drawing on theories from psychology) and on external influences (drawing on theories from sociology). Furthermore, methodological inclinations and fundamental assumptions about the unit of analysis - the consumer, differ radically between perspectives. Thus, varying perspectives present different views of aspects on consumption (as emphasized from the consumers perspective), research orientations (as emphasized from the researchers perspective), and focus (micro/individual or macro/social) on consumer issues. Research that studies consumer behaviour as a subdiscipline of marketing with the aim to identify how consumer research can be put to use in marketing practice, regards the field of consumer behaviour as an applied social science. Accordingly, the value of the knowledge generated should be evaluated in terms of its ability to improve the effectiveness of marketing practice. According to this perspective, marketing management inevitably rests upon some conception of how consumers behave and of the consequences their reactions to product, price, promotion, and distribution strategies are likely to have for the attainment of corporate goals. In affluent, competitive economies, successful marketing depends above all on matching the marketing mix, which results from the integration of these strategies with the willingness of consumers to buy and in doing so more effectively than ones rivals. The consumer-oriented management which results from such matching, is a response to the enormous discretion exercised by purchasers in these economies. Moreover, the choices made by consumers have consequences not merely for competing companies within a given, traditionally-defined industry; because of the high levels at which discretionary income is running, companies are increasingly forced to compete across the conventional boundaries of markets and industries (Foxall 1987). Recently, though, some researchers have argued that consumer behaviour should not have a strategic focus at all. It should instead focus on The American Statistical Association, the Association for Consumer Research, the Society for Consumer Psychology, the International Communication Association, the American Sociological Association, the Institute for Operations Research and Management Sciences, the American Anthropological Association, the American Marketing Association, the Society for Personality and Social Psychology, the American Association for Public Opinion Research, the American Association of Family and Consumer Sciences, and the American Economic Association (Source: http://wiscinfo.doit.wisc.edu/jcr/policy_board.htm) 322 Moneesha Pachauri the understanding of consumption for its own sake, rather than because the

knowledge generated can be applied by marketers (Holbrook 1985). While this view has emerged relatively recently, it has encouraged many to expand the scope of their work beyond the fields traditional focus, on the applied benefits of undertaking consumer studies. This more critical view of consumer research has also led to the recognition that not all consumer behaviour and/or marketing activity is necessarily beneficial to individuals or society. As a result, current consumer research is likely to include attention to the dark side of consumer behaviour, such as addiction, prostitution, homelessness, shoplifting, or environmental waste (OGuinn and Faber 1989; Barron 1989). This activity builds upon the earlier work of researchers who have studied consumer issues related to public policy, ethics, and consumerism. There is a growing movement in the field to develop knowledge about social marketing, which involves the promotion of causes and ideas, such as responsible drinking, energy conservation, and population control. This article presents a review of the literature, in the field of consumer behaviour. The first section, describes the dominant, positivistic consumer perspectives. The second section, presents a methodological and analytical overview of the traditional perspectives, already discussed in section one. Further discussion on the paradigm shifts within consumer research, is supported by a diagrammatic representation of the evolution of the field of consumer behaviour. The remainder of this section is devoted to presenting the highlights of the debate between the recent non-positivist perspectives and the traditional positivist-based approaches. This discussion surrounds the issues of fundamental assumptions and techniques of analysis of various

alternative modes of enquiry. And finally, the last section presents an overview of the developments within the field of consumer research. The Traditional Perspectives on Consumer Research This first section outlines the perspectives that emerged during the traditional-positivist era in consumer research. Thus, a brief discussion on the early models of buyer behaviour, proposed by economists is presented, followed by a discussion on each of the traditional perspectives in consumer research that emerged thereafter. These are the behavioural, cognitive, trait, motivational, attitudinal, and situational viewpoints. Overall, the objective of this section is to outline the features and the central arguments of each of these perspectives. While a detailed analytical review of the paradigms is presented in section two, at this stage it is worth noting, that the traditional perspectives while diverse with respect to the many aspects of consumer behaviour they investigate, are fundamentally similar in terms of their philosophical and methodological bases for undertaking the examination of consumer issues. That is, they are built on the common foundations of rationalism and share allegiance to the principles of a single traditional, positivist-based approach to consumer research. Consumer Behaviour: A Literature Review 323 The Rational Perspective The economists were the first to dominate model building, in the area of buying behaviour. The early economic view considered consumer behaviour in terms of a single act of purchase itself, and post-purchase reactions. Economic theory holds that purchasing decisions are the result of largely rational and conscious economic calculations. Thus, the individual buyer seeks to spend his income on those goods that will deliver the most utility

(satisfaction) according to his tastes and relative prices. The antecedents of this view can be traced back to Adam Smith (1776). Alfred Marshall (1890) consolidated the classical and neoclassical traditions in economics, into a refined theoretical framework which came to be known as the theory of marginal utility. His theoretical work aimed to simplify assumptions and thereby examine the effects of changes in single variables (e.g., price) holding all other variables constant. While economic models such as the Marshallian theory of marginal-utility are useful to the extent that they provide behavioural hypotheses (e.g., the lower the price of a product the higher the sales), the validity of these hypotheses does not rest on whether all individuals act as calculating machines in making their purchasing decisions. For example, Eva Muller (1954) reported a study where only one-fourth of the consumers in her sample bought with any substantial degree of deliberation. The Marshallian model ignores the fundamental question of how product and brand preferences are formed. While pure economics alone cannot explain all variations in sales (Westing and Albaum 1975), several sub-perspectives within the discipline set-out to provide rational explanations for behavioural, psychological, preferential, and aggregate demand variations in behaviour, to name just a few 3 For example, the experimental treatment of economic choice variables . has been useful in providing rational explanations for changes in behaviour. Several studies have identified the impacts of price differentials on

consumers brand preferences; changes in product cues on demand variations; changes in price on demand sensitivity; and scarcity on consumer choice behaviour amongst many others (Lewis et al. 1995). Moreover, while a number of perspectives on consumer research such as the learning theories, as discussed below, emphasize the external rather than internal factors that influence behaviour, it is important to note that it is the very basis of rationalism, the fundamental justification of the economic argument, on which these traditional views rest. The Behavioural Perspective As mentioned above, in contrast to the economic view which underscores the importance of internal mental processes in consumer decision making, the behavioural perspective emphasizes the role of external environmental factors in the process of learning, which it is argued causes behaviour. Thus,

3 For more detail see Lewis et al. 1995 324 Moneesha Pachauri the behaviourists approach the consumer, as a black box and thereby assume that consumer behaviour is a conditioned response to external events. The behavioural perspective therefore focuses on external environmental cues (such as advertising) that stimulate consumer response through learning. The strategic emphasis, of the behavioural modification theories, for example, are to devise a set of expanded behaviour modification techniques (e.g., respondent conditioning; operant conditioning; vicarious learning etc.) that can be used to influence, modify, and control consumer behaviour (Peter and Nord 1982). While a number of researchers have

proposed models to study learning principles e.g., Thorndike (1911); Watson and Rayner (1920), this view is represented by two major approaches to learning: classical conditioning and instrumental learning. Classical conditioning occurs when a stimulus that elicits a response is paired with another stimulus that initially does not elicit a response on its own. Over time, this second stimulus causes a similar response because it is associated with the first stimulus. The theory of classical conditioning is rooted in Pavlovs research on digestion in animals. Pavlov induced classically conditioned learning by pairing a neutral stimulus (a bell) with a stimulus known to cause a salivation response in dogs (dried meat powder). The powder was an unconditioned stimulus (UCS) because it was naturally capable of causing the response. Over time, the bell became a conditioned stimulus (CS) resulting in a conditioned response (CR). Thus, conditioned effects are more likely to occur after the conditioned and unconditioned stimuli have been paired a number of times. The basic form of classical conditioning demonstrated by Pavlov primarily applies to responses controlled by the autonomic (e.g., salivation) and nervous (e.g., eyeblink) systems. That is, it focuses on visual and olfactory cues that induce hunger or thirst. When these cues are consistently paired with conditioned stimuli, such as brand names, consumers may learn to be hungry or thirsty, when later exposed to brand cues. Classical conditioning can have similar effects for more complex reactions. Even a credit card becomes a conditioned cue that triggers greater spending, especially since it is a stimulus that is presented only in situations where consumers are spending money. People learn that they can make larger purchases when using credit cards, and they

also have been found to leave larger tips than they do when using cash (Feinberg 1986). While responses in classical conditioning are involuntary and fairly simple those in instrumental conditioning are made deliberately to obtain a goal and may be more complex. Instrumental conditioning or Operant conditioning occurs as the individual learns to perform behaviours that produce positive outcomes and to avoid those that yield negative outcomes. Skinners (1938, 1953) model of operant conditioning placed emphasis on reinforcement associated with a response (or operant). Reinforcement is a pleasant or unpleasant experience and has most effect when it occurs at the same time or just after the response. The desired behaviour may be learnt over a period of time, as intermediate actions are rewarded in a process called shaping. Operant conditioning can Consumer Behaviour: A Literature Review 325 occur in one of three ways. That is, when a response is followed by positive reinforcement in the form of a reward, when a response is followed by negative reinforcement, in order to avoid unpleasantness, and punishment which occurs when a response is followed by unpleasant events. While behavioural theories, like classical and operant conditioning, offer a number of insights about some aspects of behaviour of considerable interest to marketers, e.g., for copy strategy and repetition in advertising (as identified by Howard 1963), they have been criticized for ignoring the capacities of insight and inference that people posses. The cognitive perspective as discussed next, underscores the role of internal mental processes in consumer decision making. Following a brief introduction to the key principles of the cognitive approach, the following section describes the dominant models of consumer decision making that are based on the

cognitive problem solving postulates. The Cognitive Perspective In contrast to behavioural theories of learning, the cognitive perspective stresses the role of information processing in consumer decision making. This perspective views people as problem solvers who actively use information from the world around them to master their environment. However, much debate surrounds the issue of whether or when people are actually aware of these learning processes. On the one hand, there is some evidence for the existence of unconscious procedural knowledge. That is, people apparently do process at least some information in an automatic, passive way, which is a condition that has been termed mindlessness (Langer 1983). Nonetheless, many modern theorists are beginning to regard some instances of conditioning as cognitive processes, especially where expectations are formed about the linkages between stimuli and responses. Studies using masking effects, wherein it is difficult for subjects to learn CS/UCS associations, show substantial reductions in conditioning (Allen and Madden 1985). The information processing theory (or cognitive theory) is central to the variety of hierarchy of effect models which, as Barry and Howard (1990, 121) explain, posit that consumers go through a variety of stages, namely cognitive, affective, and conative, in responding to advertising, and other marketing messages. Accordingly, the dominant pattern of relationship between the three stages is that cognition (thought) precedes both affect (feeling) and conation (behaviour) (Marsden and Littler 1998, 7). The most widely accepted position that opposes behaviourism is that thought and

feeling can produce change in action directly. This is cognitivism; in its strongest form it suggests that attitudes control behaviour, and reinforcement only acts by changing attitudes. Overall, the implication for marketing strategy is that - Consumers must be exposed to information *e.g., advertising+ if it is to influence their behaviour (Sternthal and Craig 1982, 314). While there is some support for the behaviourist position (e.g., Clare and 326 Moneesha Pachauri Kiser 1951; Barwise and Ehrenberg 1985; and Marxist ideology - a sociological equivalent for the primacy of behaviour over attitude); as well as for the cognitive perspective (e.g., Kahle and Berman 1979), evidence suggests that precedence in the attitude-behaviour relationship, when it can be detected, varies depending upon the person, action, and context (East 1990). In addition, the cognitive theories have been criticized for assuming that individuals are complex information processing entities. Nevertheless, the problem solving perspective has tended to dominate the field of consumer research. And as discussed next, decision making models that have governed consumer theory, are in fact based on the fundamentals of the cognitive principle. Consumer Decision Making Models The three major comprehensive models for consumer decision making were proposed by Nicosia 1966; Engel et al. 1968; and Howard and Sheth 1969. These attempt to trace the psychological state of individual consumers from the point at which they become aware of the possibility of satisfying a material need by purchasing and consuming a product to their final evaluation of the consequences of having done so.

Engel et al., (1986) suggest that high involvement with a product results in an extended problem solving process which starts with problem recognition, followed by an information search, alternative evaluation, purchase, and post purchase activities. This process is aided by an active information processing sequence involving exposure, attention, comprehension, yielding/acceptance, and retention. The choice determined by the outcome of the information process-aided decision sequence may have satisfying or dissonant outcomes: Festinger (1957) first introduced the theory of cognitive dissonance for the consumer, which influence future purchasing. Engel and Blackwell (1982) also point out that environmental influences may affect the decision sequence acting on the consumers motivation and intention, and that unpredictable factors (such as non-availability of the desired brand or insufficient funds) may result in modification of the actual choice made by a consumer. This model assumes that observed consumer behaviour is preceded by intrapersonal psychological states and events (attitudeintention-purchase sequence). Moreover, the model depicts these psychological events as outputs of the processing of information, taking for granted that consumers seek and use information as part of their rational problem solving and decision making processes. Thus, one of the main criticisms of the extended problem solving models is that they assume that consumers are complex and rational decision makers (Olshavsky and Granbois 1979). Ehrenberg (1988) criticized these models because they cannot be precisely tested. The relationships between concepts are poorly specified and they lack agreed methods for measuring the concepts. It is argued that while, these steps in decision making are

followed by consumers for some purchases, such a process is not an Consumer Behaviour: A Literature Review 327 accurate portrayal of many purchase decisions (Olshavsky and Granbois 1979). Researchers recognize that decision makers actually possess a repertoire of strategies. A consumer evaluates the effort required to make a particular choice, and then he or she chooses a strategy best suited to that level of effort required. The sequence of events is known as constructive processing. This process allows consumers to tailor their degree of cognitive effort to the task in hand (Bettman and Zins 1977). Thus, the limited problem solving and habitual decision making models, as described below, were developed to account for behaviour in purchase situations where consumers are not highly involved and therefore do not undertake a rigorous problem solving approach. Low Involvement and Habitual Decision Making Krugman (1965) first used the concept of high and low involvement to differentiate the types of cognitive activity that were elicited by purchasing according to the Engel et al. (1968) model. Consumer research strongly suggests (e.g., Jacoby et al. 1977) that consumers have very limited capacities for receiving and using information, that they do not as a rule undertake rational, comparative evaluations of brands on the basis of their attributes or make final judgment among brands on the basis of such outputs of complex information processing as attitudes and intentions. When undertaking a limited problem solving process buyers are not motivated to search for information or to rigorously evaluate each alternative. People instead use simple decision rules to choose among alternatives. For example, consumers often apply heuristics (Kahneman and Tversky 1972

1973; Tversky and Kahneman 1974) or mental rules-of-thumb, such as, price is positively related to quality (Hjorth-Andersen 1987); brand names; and country of origin (Harris et al. 1994) to simplify decision making. While both extended and limited problem solving modes involve some degree of information search and deliberation, at the other end of the choice continuum, habitual decision processes are undertaken with little or no conscious effort. Many purchase decisions are so routinized that choices characterized by automaticity are performed with minimal effort and without conscious control (Alba and Hutchinson 1988). It is clear that the degree of cognitive effort exerted in any decision making process is determined by the level of product differentiation and the level of consumer involvement with a given product category. While the perceived risk associated with a purchase (especially in the case of expensive products) determines the degree of personal relevance to some extent; this is also related to factors such as ego relatedness or the consumers self concept and social role (e.g., with the case of publicly consumed goods). These aspects of consumer behaviour are examined next. The Personality Perspective As noted above, some purchases have more personal relevance than others. While this partly reflects on factors such as price, it also bears on the 328 Moneesha Pachauri way in which some products enhance the consumers self concept i.e., possessions are considered to reflect on a consumers image of him or her self. Mead (1934) used the role concept in his explanation of the social and individual nature of persons. The dramaturgical perspective on consumer behaviour views people much like actors who play different roles (Goffman

1959). Goffman (1959) introduced the concept a managed situation, the idea that people manage the impression that others have of them by the way they present themselves. In the presence of others, the actor is seen to organize his activity in order to express an impression that he wishes to convey. The object of the study of role theory is to increase understanding of role enactment of individuals in social settings, so as to understand and predict behaviour. Marketings interest in the study of personality derives from the possibility that, in spite their uniqueness as individuals, members of groups and aggregates may possess a given trait or type in common with each other e.g., extraversion (Eysenck and Eysenck 1975); such groupings (typologies) might then become the basis of separate market segments and justify special marketing action. Personality in general is understood as a concept which accounts for the apparent consistencies and regularities of behaviour over time and across a variety of situations (Pervin 1984). As such, personality constructs explain those aspects of behaviour which are relatively stable across situations and, as a result, are predictive of future behaviour. Personality has also been understood as the unique way in which traits, attitudes, aptitudes, etc. are organized in an individual (Marx and Hillix 1979) and this draws attention to the ways in which individuals differ from one another through the peculiar configuration of traits and other characteristics each possesses. While individuals might not always be uniform and predictable in their patterns of choice in different situations, it might be possible to make sense of and to forecast the general reactions of broadly-defined groups and classes of purchasers. As discussed next, it is this concept of consumer general

behavioural response patterns that forms the basis for marketings personality based segmentation strategies. The Motivational Perspective and Psychographics The possibility of using measures of personality to guide marketing action, for example in segmenting markets psychographically, tailoring new brands to the susceptibilities of innovative consumers, and repositioning mature brands, has encouraged a large volume of research. Few significant relationships, which would be of interest to marketing managers resulted from the research which concentrated upon the search for links between aspects of consumer choice (such as brand selection) and highly specific personality traits (such as sociability). However, the investigation of personality types, broad bundles of complementary traits which describe an individuals general pattern of behavioural response has shown more promise in the quest to describe and predict consumer behaviour. Thus, the success of personality research is also partly attributed to the simultaneous Consumer Behaviour: A Literature Review 329 widespread dissatisfaction with psychoanalytical techniques of motivational research. The first attempts to apply Fruedian and neo-Feudian (e.g., Horney and Adler) concepts, were made in the 1950s, when a perspective known as motivational research was developed. Ernest Ditcher advocated the use of psychoanalytical techniques to uncover hidden motivations (e.g., to understand the deeper meanings of products and advertisements). He strongly argued that people could not be asked why they did what they did directly, because most of the time they did not know. Ditchers ideology of truth-is-in-the-subconscious, behind his in-depth interviews was much

criticized by traditional statistical researchers who called such motivational research a pseudo science (e.g., Politz) (Piirto 1991). Perhaps the most persistent problem with motivational research was that it failed one of the cardinal rules of scientific methods - replicability. Two researchers could draw two totally different conclusions from the same interview, because motivational research was so dependent upon individual interpretation. Thus, the widespread dissatisfaction with simple demographics and disenchantment with motivational research, coupled with the increasing accessibility of computers gave many researchers the raw material needed to measure the quantitative elements of personality traits, motivations, and psychological attributes (e.g., Yankelovich 1958). As consumer researchers were increasingly influenced by psychology (e.g., ego concepts such as selfesteem) and sociology (e.g., social status and social character, for example the Riesman model), in their attempts to understand the changing nature of consumer values (which offered potential benefits to market segmentation); simultaneously, a wider emphasis on typologies also emerged such as benefit segmentation (Haley 1972), lifestyle or Activities, Interests, and Opinions, or AIOs (Wells and Tigert 1971), and psychographics e.g., VALs. In many applications the term psychographics is used interchangeably with lifestyle to denote the separation of consumers into categories based on differences in choices of consumption activities and product usage. While a number of typologies are used to segment consumers, the underlying objective is to identify the subjective differences between observably similar consumer characteristics (e.g., by identifying the different ways in which demographically similar consumers chose to spend their leisure, time, and money). Demographics allow marketers to describe who buys, whereas

psychographics allow them to identify why they do (Solomon 1995). The adoption of a lifestyle marketing perspective implies that consumer researchers must look at patterns of behaviour to understand consumers. An examination of the processes by which consumers make a variety of choices between product categories, in turn, facilitates clarity about peoples use of products to define lifestyles. Indeed, many products and services tend to go together, usually because they tend to be selected by the same types of people. Douglas and Isherwood (1979, 72-73) noted, all goods carry meaning, but none by itselfThe meaning is in the relations between all the goods just as music is in the relations marked out by the sounds and not in 330 Moneesha Pachauri any one note. Therefore, an important part of lifestyle marketing is to identify the set of products and services that the consumers associate with a specific lifestyle. Product complementarity occurs when the symbolic meanings of different products are related to each other (Solomon 1983). These sets of complementary products, are termed, consumption constellations, and are used by consumers to define, communicate, and perform social roles (Solomon 1995, 582). However, more recently, research suggests, that anti-constellations i.e., the abandonment, avoidance, or aversion which is linked to anti-choice (Hogg 1998), serves as a better indicator of consumer-product associations and corresponding social roles. Nevertheless, goods acquire meanings within social contexts and consumers associate or disassociate with sets of products, based upon their compatibility with roles, lifestyles, and social groups or classes, as discussed next. Moreover, it will become apparent, that these social groups exert influence on behaviour in the form of referent power, which in turn

determines how consumers make certain product choices. Consumer Behaviour as a Social Decision Making Process Veblen (1899, 1949) was the first to introduce the idea of conspicuous consumption, i.e., possessions have symbolic value. Many researchers have commented on the social influences on behaviour. The various streams of thought crystallized into the modern social sciences of sociology, cultural anthropology, and social psychology. Basic to them is the view that mans attitudes and behaviours are influenced by several levels of society for example, culture, subcultures, social classes, reference groups, and face-toface groups. Culture refers to the values, ideas, artefacts, and other meaningful symbols that help individuals communicate, interpret, and evaluate as members of a society. Marketing acts as a value transmitter that simultaneously shapes culture and is shaped by it. Marketing is then a channel through which cultural meanings are transferred to consumer goods (McCracken 1987). Products act as social symbols and are therefore significant of ones social class. Social classes are composed of individuals who share similar values, interests, and behaviours. People within a given social class are approximately equal in terms of their social standing in the community. They work in roughly similar occupations, and they tend to have similar lifestyles by virtue of their income levels and common tastes. These people tend to socialize with one another and share many ideas and values regarding the way life should be lived (Coleman 1983). Class membership influences an individuals consumption behaviour as products consumed by individuals have symbolic value which also reflect on their role in society. Society therefore develops norms i.e., informal rules that govern behaviour. Consumers conform to norms broadly due to their normative

social influence, which occurs when individuals conform to meet the expectations of a person or group; or informational social influence, which refers to conformity that occurs because the groups behaviour is taken as Consumer Behaviour: A Literature Review 331 evidence about reality. Consumers belong to many different groups that influence their behaviour. Reference groups refer to all external influences that provide social cues (Gergen and Gergen 1981). The likelihood that an individual will become a part of a consumers identificational reference group depends on several factors. One such factor is propinquity. A study on housing, conducted by Festinger et al. (1950) revealed, that physical structure has a lot to do with whom we get to know and how popular we are. As physical distance decreases and interaction (or physical nearness) increases relationships are more likely to form. According to the mere exposure phenomenon, we come to like people or things simply as a result of being exposed to them more often. Thus, greater frequency of interaction may help determine ones set of local referents. As the value of the reference group to the individual increases, so too does the likelihood that the group will guide consumption patterns. Thus, groups exert social power which refers to the capacity to alter the actions of others (Gergen and Gergen 1981, 312). The referent may be a cultural figure, a person, or a group whose influence is confined to the consumers immediate environment. Some groups or individuals exert a greater influence than others and for a broader range of consumption decisions. For example, parents may play a pivotal role in the forming of values toward some issues. A reference group that helps set and enforce fundamental standards of conduct exerts a normative influence. The challenge to the marketer is to determine which of

these social levels are the most important in influencing the demand for his product. It is clear, therefore, that a number of factors (at both the individual and social levels) act simultaneously to influence behaviour. Furthermore, the level of personal relevance of products is determined by the degree to which they relate to a consumers self concept and thereby serve to enhance his or her self image; as well as the symbolic meanings they encapsulate and convey at a broader social or cultural level. Thus, the level of involvement with a product category may vary from individual to individual. Moreover, a consumer may be highly involved in a purchase decision but may not lend himself or herself to a rational approach (as seen with the case of products that relate closely to a consumers self concept). Thus, the type of decision process that a purchase entails depends upon the degree of consumer involvement, which in turn depends upon a whole gamut of factors, as discussed above. The relative importance of each of these factors in the decision making process, is significant from the point of view of the sequence of events that occur en route to attitude formation, as discussed next. The Attitudinal Perspective Attitudes are predispositions felt by buyers before they enter the buying process. The buying process itself is a learning experience and can lead to a change in attitudes (Politz 1958). Thus, attitudes do not automatically guarantee all types of behaviour. They are really the product of social forces interacting with the individuals unique temperament and abilities. Thus, as 332 Moneesha Pachauri discussed above, social influences determine some but not all of the behavioural variations in people. Two individuals subject to the same

influences are not likely to have identical attitudes, although these attitudes will probably converge at more points than those of two strangers selected at random. Most researchers agree that an attitude has three components: affect, behaviour, and cognition. Affect refers to the way a consumer feels about an attitude object 4 , behaviour involves the persons intentions 5 to do something with regard to an attitude object, and finally, cognition refers to the beliefs a consumer has about an attitude object. While all three components of an attitude are important, their relative importance will vary depending upon the consumers level of motivation with regard to the attitude object. Attitude researchers have developed the concept of a hierarchy of effects to explain the relative impact of the three components. Each hierarchy specifies that a fixed sequence of steps occur en route to an attitude. According to the theory of cognitive information processing, attitudes are formed in the order of beliefs, affect, and behaviour. Attitudes based on behavioural learning follow the beliefs, behaviour, and affect sequence. And finally, attitudes formed based on the experiential hierarchy follow the affect, behaviour, and beliefs route. A consumer who is highly involved with a product category and who perceives a high level of product differentiation between alternatives will follow the cognitive hierarchy (beliefs-affect-behaviour). From the marketers perspective the sequence of attitude formation is pertinent from a

communications point of view. Accordingly, here, a marketer will first attempt to create Attention, then Interest and Desire, and finally Action (AIDA). Thus, from a strategic point of view, Multi-attribute attitude models, such as the Fishbein (1983) model, have proved useful in specifying the different elements that work together to influence peoples evaluations of attitude objects and ultimately predict consumer attitudes; products or services may be composed of many attributes, or qualities, some of which may be more important than others to particular people. Also a persons decision to act on his or her attitude is affected by other factors, such as whether it is felt that buying a product would be met with approval by friends and family. The complexity of attitudes is underscored by multi-attribute attitude models, in which sets of beliefs and evaluations are identified and combined to predict an overall attitude. While multi-attribute models have been used extensively, by consumer researchers they make certain assumptions that limit their applicability in accurate prediction. For example they assume that it is possible to adequately specify all relevant attributes that, for example, a consumer will use when evaluating a product choice. The theory of reasoned action (Ajzen

4 An attitude object is anything toward which one has an attitude 5 It is important to note that intention does not always result in actual behaviour. For example, when a desired brand is out of stock, a persons past behaviour may be a better indicator of future behavior (Bagozzi et al. 1991) Consumer Behaviour: A Literature Review 333

and Fishbein 1977) attempts to improve in many ways the predictability of attitude models by integrating factors such as behavioural intentions (recognizing that certain uncontrollable factors inhibit prediction of actual behaviour), subjective norms (the revaluation of consumer preferences for product choice, to include the effects of what others think), and attitudes toward the act of buying (rather than towards the product alone). Overall, the attitude models have been useful in identifying the sequence of attitude formation and thereby behaviour, to guide effective advertising and copy design strategies. An example of this is elicited in the involvement paradox, that is, the less important the product is to the consumer the more important are the many marketing stimuli (e.g., packaging, jingles in advertisements), devised (to create positive affective responses for instance) to sell it. Accordingly, the Elaboration Likelihood Model, states that executive elements of the advertisement are critical where personal relevance is low and information takes a peripheral route to persuasion. Conversely, it states that where involvement with a product category is high, information takes the central route to persuasion and therefore, content related information is critical (Petty et al. 1983). Models like the Elaboration Likelihood Model have been useful in designing effective advertising strategies based on consumer involvement with different product categories. While the perspectives discussed so far, reflect the effectiveness of isolating individual influences to examine their impact on behaviour, the situational perspective, as discussed next, is characterized by an emphasis on a totality or set of factors that work simultaneously to influence behaviour, within any given context.

The Situational Influence Perspective A situation is defined by factors over and above the characteristics of a person and product. For example, as explained below, situational effects may be behavioural (e.g., entertaining friends), experiential, or perceptual (e.g., being depressed or being pressed for time) (Kakkar and Lutz 1981). According to the behavioural influence perspective of low involvement decision situations, consumer decision making is a learned response to environmental cues, as when a person decides to buy something on impulse that is prompted as a surprise special in a store. According to this approach, then marketers must concentrate on assessing the characteristics of the environment, such as the physical surroundings and product placement, that influence members of that target market. For example, pointof-purchase stimuli (such as product samples) are particularly useful in inducing impulse purchases. The experiential perspective stresses the gestalt, or totality, of the product or service. The principles based on the work of Gestalt psychology (Koffka 1935) maintain that people derive meaning from the totality of a set of stimuli, rather than from any individual stimulus. Here consumers may be highly involved in a decision, but may not lend themselves to the rational approach. Marketers focus on measuring consumers affective responses to products or 334 Moneesha Pachauri services and develop offerings that elicit appropriate subjective reactions and employ effective symbolism. Situational effects can also be perceptual i.e., there could be a number of ways in which mood can influence purchase decisions. For example, stress can impair information processing and problem solving abilities. In addition, time poverty can impact buying decisions. An individuals priorities determine

his or her timestyle (Feldman and Hornik 1981). One result of increasing time poverty is an increase in polychronic activity, wherein consumers perform more than one activity at the same time (especially prevalent in eating). The psychological dimension of time, or how it is experienced, is an important factor in queuing theory, the mathematical study of waiting in lines. A consumers perception of waiting in lines can radically influence his or her perceptions of service quality (e.g., the negative feelings aroused by long waits can quickly turn off customers (Taylor 1994). In addition, moods can be affected by store design and in-store music. Marketing appeals aimed at arousing emotional reactions often use music in commercials, as this is known to stimulate positive consumer reactions to products and commercials (Bruner 1990). In addition to the behavioural, experiential, and mood related situational effects, a consumers physical and social environment can impact motives for product usage and also how the product is evaluated. For example, the persons particular social identity, or role that is being played at a give time may affect behaviour (Burke and Franzoi 1988). One aspect of situational role is the degree to which a consumers ethnic identity or felt ethnicity, is activated during a purchase situation. When people are reminded of this connection, they are more likely to tailor their product choices along ethnic lines (Stayman and Deshpande 1989). In addition, the role a person plays at any time is also determined by his or her situational self-image (Schenk and Holman 1980). Then from the marketers perspective, knowledge of what consumers are doing at the time a product is consumed can improve predictions of product and brand choice (Belk 1974).

Thus, consumers tailor their purchases to specific occasions i.e., the way they feel at a specific point in time affects what they feel like buying or doing. A consumers mood or physiological condition active at the time of purchase can have an important impact on what is bought and can also affect how products are evaluated. One reason for this is that, behaviour is directed toward certain goal states e.g., people spend more in a grocery store if they have not eaten for a while because food is a priority at that time. Thus, buying activity may be undertaken for utilitarian (functional or tangible) or hedonic (pleasurable or intangible) reasons (Hirschman and Holbrook 1982). It is clear therefore, that a totality or set of factors (e.g., consumer psychological states and in-store retail environments) influence consumers at the time of purchase. According to the situational influence perspective, then the shopping experience is a pivotal part of the purchase decision. Consumer Behaviour: A Literature Review 335 An Overview of the Traditional Perspectives It is clear therefore, that the traditional perspective encompasses a wide spectrum of consumer research issues. This spans the economic, behavioural, cognitive, trait, motivational, attitudinal, and situational influences on behaviour. In addition to the diversity of views, perspectives on consumer research are multidisciplinary. The scope of research varies as well, ranging from an individual (or micro) to a social (or macro) focus. However, as discussed in greater analytical detail in the following section, it is important to note, that these perspectives while diverse in their views, are actually quite similar in terms of their adherence to the assumptions of a single scientific style of research guidance i.e., the positivist approach. The traditional perspectives therefore, share commitment to a common rationalist

ideology and empirical philosophy that guides their examination of consumer issues. Thus, these perspectives are founded on a unified doctrine, which purports that man is basically rational, stable, and knowable. The positivist research endeavour therefore, aims to formulate universal laws, based on identified patterns of observed behaviour that can be used to guide the overall goal of marketing practice. The Evolution of Consumer Research This section aims to paradigmatically identify the developments within the field of consumer research. Paradigms in consumer research can be broadly classified as a set of fundamental assumptions that researchers make about what they are studying and how they study it. As described below, a set of dimensions as identified by the literature, are employed to characterize and differentiate, chronologically, the paradigms enveloping various perspectives. To further support the discussion, this section provides a diagrammatic representation of the evolution of the field of consumer research 6 , as identified in figure 1. From the figure it is evident, that consumer behaviour itself, emerged as a distinct field of study during the nineteen sixties, as indicated by the 1960s column, along the time-line. The figure broadly identifies two paradigms within the field the positivistic and the non-positivistic, as illustrated by the labels at the top. Progressing from the left to the right, the figure presents, the various perspectives chronologically. It can be seen, that the positivist paradigm encompasses the rational, behavioural, information processing,

motivational, trait, attitudinal, and situational perspectives, or the traditional perspectives as they are called.

6 It is important to note that this diagram is not all-inclusive. It is simply a visual representation of the paradigmatic shifts, established against a set of broadly defined dimensions 336 Moneesha Pachauri ure 1. Evolution of Consumer Research g FiConsumer Behaviour: A Literature Review 337 Positivism (or modernism), the dominant paradigm at this point in time emphasizes the supremacy of human reason and that there is a single, objective truth that can be discovered by science. This paradigm regards the world as a rational and ordered place with a clearly defined past, present, and future. The assumption of rationalism is therefore fundamental to the traditional perspective. The horizontal arrow across the top of the figure therefore corresponds with the tenet of rationalism that dominates the traditional perspective. The opposing, non-positivist paradigm, envelops the interpretive and postmodern perspectives, which have emerged more recently during the post nineteen eighties period. The proponents of this emerging perspective argue that positivism overemphasizes the rational view and the ideology of a homogenous social culture and thereby denies the complex social and cultural world in which consumers live. They instead stress, the importance of symbolic and subjective experience and the idea that consumers construct meanings based on unique and shared cultural experiences, and thus there can be no single unified world view.

The vertical axes on either side of the figure suggest, that the emphasis, across the range of perspectives differ broadly along two dimensions - the benefits derived from consumption and the objectives that underscore consumer research. As indicated by the vertical labels, these range from utilitarian to symbolic on the left; and production to consumption on the right. The perspectives of consumer behaviour (as indicated by the black boxes) are depicted in a step-like fashion, to suggest that they vary along these dimensions. At the top left corner of the figure, the rational perspective assumes economic behaviour, and thereby emphasizes the utilitarian benefits from consumption. At the opposing extreme, postmodernism suggests that consumption is driven by a symbolic pursuit. The objective of this type of research, in contrast to that of rationalist perspective, is to understand the nature of consumer behaviour with no specific strategic intent in mind. The range of disciplines employed by researchers, approach aspects of behaviour from different perspectives. These are depicted in black text, within the corresponding columns. The white text within each column represents the key disciplinary orientations, pertaining to each view. The emphasis of each perspective is roughly categorized by its individual or social focus. These are indicated using horizontal labels, fitted across the set of corresponding views. The positivistic and the non-positivistic paradigms differ from each other in terms of the detailed research methods and techniques through which each collect data, as well as, the more general philosophies upon which this collection and analysis of data are based (Haralambos and Holborn 1990).

The remainder of this section is devoted to a discussion on each of the paradigms. To begin with, the assumptions and the methodological foundations of the positivist paradigm are established. These are 338 Moneesha Pachauri subsequently compared and contrasted with those of the recent non-positivist perspectives. The Positivist Perspective The traditional positivist approach is established on the premise that consumers are largely rational, stable, and knowable entities. The positivist philosophical stance is characterized by an emphasis on scientific observation and testing. The objective of this type of research is therefore, to observe empirical facts and to establish generalizable laws that can used to predict and control behaviour. The outcome of the positivist pursuit is directed toward advancing the overall goals of marketing practice. The positivist perspective therefore assumes that a single reality exists; events in the world can be objectively measured; and the causes of behaviour can be identified, manipulated, and predicted. Thus, the basis of the traditional perspectives is that consumer behaviour is controlled by forces which operate largely beyond the control of consumers themselves (Anderson 1983). Accordingly, change is not something which consumers do for themselves, rather it is a result of something that is done to them by some internal (e.g., trait) or external (environmental) force over which they have little or no control (OShaughnessy 1985). For example, the behavioural perspective suggests that consumer behaviour is largely determined, or conditioned, by external environmental stimuli (Bagozzi 1980). This static nature of consumer behaviour, is further reinforced by the

assumption that consumers are motivated primarily or exclusively to reduce tensions and maintain an internal state of equilibrium (Hjelle and Ziegler 1992, 19). It is assumed therefore, that consumers strive to maintain stability. As Firat et al. (1995, 43-44) observe - Consumer behaviour theories believe in consistency and orderliness of consumer behaviourThus, the general assumption has been that if and when informed about such characteristics of the consumer [cognitive responses, conditioned responses, personality traits etc.], some meaningful prediction of their actions can be achieved. The traditional perspectives therefore, assume a highly reactive or passive consumer. For instance, the behavioural perspective assumes that consumers lack a conscious selfreflective ability and as a result can be totally controlled and manipulated by marketers through environmental engineering (Foxall 1997; Hudson and Murray 1986; Rose et al. 1990). This assumption, leads us to one of the main criticisms of the traditional perspectives. That is they assume that consumers are passive organisms, and in doing this, they actually diminish the primacy of consumers in marketing exchanges (Bagozzi 1980; Runyon and Stewart 1987). This argument is reiterated by the AMA (1988, 4) The role of consumers in producing marketing knowledge, unfortunately, is much like the role of laboratory animals in experiments: they are observed, interviewed, and counted. Perhaps marketing would benefit if the customer hada less passive role. Consumer Behaviour: A Literature Review 339 This criticism also relates to the assumptions that the positivists make about methods of obtaining knowledge about consumer behaviour (Slife and Williams 1995). Overall, the assumption associated with the traditional

perspectives, is that consumers are basically knowable entities. Therefore, the traditional perspectives believe that consumer experience can be broken down and analyzed in terms of its component parts, as reflected in most cognitive and behavioural depictions of the consumer (OShaughnessy 1985). The different component parts of consumer experience are researched using various objective analytical techniques such as standardized surveys, experimental techniques, and personality tests etc. (Mostyn 1977). However, the main criticism of these techniques is that they are inherently incapable of dealing with the richness of the consumer behaviour phenomena, because in the process of isolating a single characteristic for detailed analysis, they neglect the complex and interdependent nature of the system as a whole (Runyon and Stewart 1987). For example, Braithwaite (1983, 19) criticizes standardized quantitative methods (such as questionnaires) for being restrictive in the way respondents can describe and explain themselves*making+ respondents mere passive reactors. However, despite these criticisms, traditional methods of investigation have proved effective in generating laws to facilitate positive prediction and control of behaviour. In addition, the results from scientific inquiry are reliable and replicable insofar as they are derived from the observation of empirical facts. Finally, the adoption of the traditional-positivist approach, the dominant paradigm in consumer research, has proved quintessential to the creation of applied consumer knowledge and accordingly the evolution of marketing practice. The more recent non-positivist perspectives, however, aim to redress some of the criticisms of the traditional approaches, as discussed

next. The Non-Positivist Perspectives In contrast to the traditional perspectives, the interpretive and postmodern perspectives of consumer behaviour attribute consumers with the capacity to proactively assign meaning to and represent their environments rather than just passively respond to them (Hirschman 1986; Calder and Tybout 1987). The interpretive perspective for example suggests, that behaviour is channeled by the content and structure of consumers subjective meaning systems (Holbrook 1995). As OShaughnessy and Holbrook (1988, 206) explain - From an interpretivist point of view, actions like buying are not simply matters of rational calculation with consumers computing up the pros and cons of objective facts, but rather are matters involving felt expectations as to how the consumption episode will be personally experienced. Thus consumers behave and make decisions by reference to the internal (psycho) logic of their subjective meaning systems. The focus of inquiry of the interpretive and postmodern perspectives therefore becomes, consumers 340 Moneesha Pachauri subjective meanings and language or discourses 7 (Buttle 1989; Firat 1992; Hirschman 1985). Brown (1995b, 295), asserts however, that the interpretive perspective is different from the postmodern perspective in marketing because the former presupposes an autonomous human subject, the free-thinking, selfconscious individual. For example, humanistic and phenomenological perspectives conceive the individual consumer as a unified, coherent and rational agent who is the author of his or her own experience and meaning;

therefore, analogous to the traditional conjecture, the interpretive paradigm also assumes that there is some pre-given natural essence of consumers (Slife and Williams 1995). In addition, whilst the interpretive paradigm stresses the experiential side of consumer behaviour such as fantasies, feelings and fun (Holbrook and Hirschman 1982), it suggests that consumers construct coherent and consistent representations, or subjective maps, of the world in order to make it more meaningful and predictable (Burrell and Morgan 1979). Moreover, these subjective maps are assumed to be intersubjective, which means that they are shared and understood by most people in society (Buttle 1990). In contrast, the postmodern perspective argues that there is no fixed or pre-given essences residing inside consumers that make them behave the way they do (Brown 1995a; Firat et al. 1994). Rather, self-identity and subjectivity are assumed to be constituted by particular forms of language, or discourses, which in turn are mediated by the consumers social interactions (Foster 1983). Thus, identity is said to be constantly in flux and changing depending upon with whom the consumer is consuming, in what circumstances they are consuming, and for what purposes (Burr 1995). The postmodern perspective of consumer behaviour firmly points to the fragmentary and fluid nature of consumers self-identity. Firat et al. (1995, 44) contend, that consumers frequently change their self-concepts, character, values and often subscribe to multiple and often highly contradictory value systems, lifestyles, etc., without feeling inconsistent or improper. Thus, the postmodern perspective places great emphasis on the creativity, autonomy, and power of consumers to define and change

themselves and the world in which they live through different patterns of consumption and lifestyles (Brown 1995b). According to this view the consumer does not make consumption choices solely from products utilities but also from their symbolic meanings (Belk 1988; Bourdieu 1994; Dittmar 1992; Gabriel and Lang 1995; Giddens 1991; McCracken 1988). Central to this perspective is the notion that as soon as a products ability to satisfy mere physical need is transcended, we enter the realm of symbolic meaning of goods. The functions of the symbolic

7 Therefore, one of the favoured methods employed to meet the end of postmodernist research, is deconstructionism (Brown 1995a; Burr 1995). This involves the close reading, or interrogation of texts (anything that can be read for meaning, e.g., literature, films, products etc) Consumer Behaviour: A Literature Review 341 meanings of products operate in two directions, inward towards constructing self-identity self-symbolism and outward in constructing the social world social-symbolism (Elliot 1997). Corresponding to these perspectives, therefore, consumption plays a central role in supplying meanings and values for the creation and maintenance of a consumers personal and social world, so advertising is recognized as one of the major sources of these symbolic meanings. These cultural meanings are transferred to brands and it is brands which are often used as symbolic resources for the construction and maintenance of identity (Elliot 1998). In addition, Firat (1992, 204) emphasizes that this reflects the general association of consumer culture with human freedom - *The+ ability to switch images and represent different

selves, by switching products that represent the images, allowing oneself to lay claim to powerful, successful images is considered as a liberation: freedom from monotony, boredom, and the necessity to conform. This, however, leads to one of the main criticisms of both the postmodern perspective and to a lesser extent the interpretive perspective of consumer behaviour, that is, their blindness to the non-discursive limits to human action (Rose et al. 1990). As Thompson and Hirschman (1995, 151) point out, for example, postmodernism is based on an idealist assumption that consumers stand above the constraints of culture, the ties of history, and the material reality of the body. Therefore, postmodernism in particular suggests that consumers can simply select or discard self-identities as they like, free from any sense of anxiety or uncertainty (Robbins 1994). Further still, Bauman (1990) argues that in Western capitalist societies some people have more money, i.e., cultural capital, than others and therefore more practical freedom of choice. Thus, At the end of the day, it transpires that with all the alleged freedom of consumer choice the marketed life-styles are not distributed evenly or randomly; each tends to concentrate in a particular part of society and thus acquires the role of a sign of social standing. Life-styles tend to become, one may say, class-specific (Bauman 1990, 211). The postmodernist approaches in particular, are criticized for being preoccupied with the philosophy of science almost as an end in itself (Foxall 1995, 2) thus the implications of their arguments are divorced from theoretical frameworks that guide investigation and understanding. Moreover, it is argued, that even the non-positivist methods tend to abstract behaviour from context. For example, the central task of hermeneutical methods, is to reveal

an actors understandings of his or her behaviour; and meanings he or she identifies with that behaviour. This is done through a method of assigning meaning to written texts; which have been produced under radically different cultural conditions from those of the interpreter. Thus, even the interpretive methods have tended to abstract behaviour from its historical and contextual antecedents (Foxall 1995). Finally, it is argued that these methods are not entirely hermeneutical in the narrow sense of trying to account for or understand consumer behaviour in the absence of any reference systems labeled positivist (Foxall 1995). Even hermeneuticists have generally sought a warrant of assertibility (Dewey 1966), i.e., they have recognized 342 Moneesha Pachauri that their claims, in order to be taken seriouslymust be supported with appropriate arguments or evidence (Phillips 1992, 108). It is argued further, that they have sought that warrant in the canons of approval founded on scientific procedure and logic (Foxall 1995). In conclusion, therefore, even the non-positivist approaches rely on intersubjective external references which makes them acquiescent to positivist scrutiny. On the whole, while the interpretive and postmodern perspectives do provide some diversity of analytical perspectives 8 , it is argued, that they are discussed at a rather abstract level divorced from some of the key marketing concepts and practical issues of concern to marketers (Kavanagh 1994). Thus, the basic assumptions and implications of these perspectives have not yet been well understood (Hunt 1994; Sheth 1992) and consequently not fully embraced by the discipline (Goulding 1999).

It is clear that, the new perspectives proposed in response to the intellectual hegemony of the traditional perspective represent a radical departure from the positivistic paradigm that has dominated marketing thought and practice, since the Second World War (Kotler 1972). Modernism, of which positivism, objectivity, and scientific procedures are a part, is built on the premise that the subject, the consumer, is a centered, self-conscious, and committed entity. Consequently, the modernist project tends to hold that a unity of self or self concept, a sense of ones identity and character, can and does exist. The consumer, then, equipped with such a united concept of self and commitment to it strives for the satisfaction of (clearly) identified needs. Such unity of purpose, character, and self logically suggests a stability in the consumers orientations and behaviour. This makes segmentation into relatively homogenous behaviour/need/orientation groups, or the more recent types (as in the VALS typology) possible and is useful as a marketing principle and tool (Firat and Schultz II 1997). The non-positivistic perspectives (particularly postmodernism) question and criticize modernisms claims on philosophical, cultural, and empirical grounds. Firat and Venkatesh (1995, 240) argue that, modernism reduces the world into simple dichotomous categories of consumer/producer, male/female and so on. Postmodernism (as does interpretivism) regards

8 Methodological innovations are becoming increasingly implicit in the work of a growing number of scholars. For example, Wallendorf and Brucks (1993) and Gould (1995) advocate the use of introspection consumer research; McQuarrie and

McIntyre (1990) and Thompson et al. (1990) argue for phenomenological positions to be adopted; OShaughnessy and Holbrook (1988), OShaughnessy (1992), and Holbrook and Hirschman (1993) illustrate the potential for the use of hermeneutics and semiotics in the study of consumer behaviour; Murray and Ozanne (1991) and Hirschman (1993) promote critical theory as a conceptual framework; Anderson (1986) suggestes the use of critical relativism; Venkatesh (1992), Brown (1995), and Firat and Venkatesh (1995) support the case for postmodern approaches to contemporary consumer behaviour; while Elliot (1996) discusses the application of discourse analysis within the marketing context (Goulding 1999). Consumer Behaviour: A Literature Review 343 these dichotomies as unsuccessful historical attempts to legitimize partial truths. In sum, it can be argued that the new perspectives may legitimately be classified as part of the non-positivist movement, which acknowledge the social, complex, and often irrational and unpredictable nature of consumer behaviour. This view focuses on not just the process of buying, but gives equal significance to the experiential and meaningful aspects, which underpin consumption. An Overview of the Paradigms in Consumer Research As outlined above there are a number of distinct genres or styles of consumer behaviour research. The traditional (pre-nineteen eighty) perspectives are similar in terms of their adherence to the principles of the positivist paradigm. The main criticisms of the perspectives on consumer behaviour based on this paradigm, is that they tend to treat consumers as passive objects of study to be manipulated in the research process and as a result ignore much of the complexity and richness of consumer experience. In response to these criticisms, new perspectives on consumer research,

most notably, the interpretive and postmodern perspectives have emerged over the last twenty-year period. From the above analysis it is clear that the interpretive perspective differs from the traditional perspectives in terms of its focus on the subjectivity of consumers. The key objective of interpretive research is to identify the meanings that consumers attach to their consumption experiences, through the careful use of qualitative frameworks of inquiry. The postmodern perspective, however, differs from both the traditional and interpretive perspectives of consumer behaviour in terms of its rejection of all such rational attempts to understand consumer experience. Instead, the aim here is to interrogate different representations of consumer behaviour, or regimes of truth, and to celebrate a plurality of views. However, the interpretive and postmodern perspectives are criticized on the argument that they tend to be pitched at a very abstract level and divorced from some of the practical issues of concern to marketers. The traditional approaches have tended to split up consumer experience into different component parts, or variables, elevating one or the other as largely predominant (Kassarjian 1994). This division however, has, resulted in the restriction of researchers to their specific perspective with few taking a more comprehensive or holistic view of consumer behaviour (Marsden and Littler 1998). The interpretive and postmodern perspectives argue that consumers can only be fully understood as totalities, that is, holistically. For example, the interpretive perspective is strongly associated with the use of naturalistic methods of inquiry that attempt to get as close as possible to the experienceas-lived by consumers (Gabriel 1990). Qualitative methods (e.g., ethnographic) are privileged within the naturalistic approach, because it is

assumed they can reveal how individuals describe, explain, or otherwise account for the world in which they live (Gergen 1985, 3-4). In contrast with traditional objective-quantitative methods, therefore, qualitative methods give 344 Moneesha Pachauri more scope for accounting by allowing individual expression in respondents own terms as well as more freedom to explain the action in whatever way seems important, by bringing in particular aspects of the situation, and relevant others, as deemed necessary (Braithwaite 1983, 34-35). Unlike the postmodern perspective, however, interpretive methods of inquiry, it is argued, are quite similar to traditional positivist-based approaches to consumer research, to the extent that they assume that the truth about consumers world views can be rationally known and accurately represented through careful use of appropriate naturalistic, interpretive and ethnographic research methods (Brown 1995a, 32). The research process from a postmodern perspective, in contrast starts with the assumption that consumer behaviour is basically unknowable because all forms of human knowledge and understanding are culturally and historically loaded (Burr 1995; Firat et al. 1994). Thus, one of the methods favored by postmodern consumer researchers is deconstructionism, which is the interrogation of texts e.g., interpretive theories and methods, to uncover hidden assumptions and implicit meanings (Firat et al. 1995). It is disputed, however that these methods actually tend to abstract behaviour from its context, since historical texts are produced under cultural conditions that are radically different from those of the interpreter. In addition, it is argued that these methods ultimately rely on some form of external reference, i.e., the positivist logic, to make their claims legitimate, meaningful, and understood.

Therefore, it is argued that *positivistic methods are+ used wherever interpretation takes place (Follesdal 1979, 319). Thus, the traditional approach is appropriate to the evaluation of even the interpretive and postmodern consumer research methods, since they ultimately rely on standard external references that make them amenable to scientific testing (Foxall 1995). The overall argument in favour of scientific inquiry and positivistic research is that it involves a form of investigation in which the legitimacy of generalizations and theories is evaluated against their relations to empirical data, or observed facts (Schwartz and Lacey 1982, 75). Thus, these methods are reliable insofar as they are independent of observer subjectivity; and can be replicated across situations (Zuriff 1985). Thus, Once causal laws have been established, they can be invoked to explain individual phenomena; specific observations can be made intelligible by being placed into appropriate categories which the law-like generalizations have revealed (Schwartz 1989, 6). It is clear, therefore, that scientific inquiry, the fundamental basis of the dominant positivist paradigm, is central to the consumer research project. Conclusion Overall, it is argued that the study of consumer behaviour is rapidly evolving as researchers recognize and implement new techniques and transdisciplinary perspectives to understand the nature of purchase and consumption behaviour. This wider view attempts to study consumer Consumer Behaviour: A Literature Review 345 behaviour in the light of rapidly evolving lifestyles, values, priorities, and social contexts. Various theories on consumer research were not tested empirically until

the middle twentieth century. The distinctly practical emphasis awaited development of the field of marketing in the business curriculum. In particular the buying process of consumer behaviour is of more importance to marketing practitioners than the consumption process. From a practitioners perspective consumer research is pertinent so as to enable him to understand changing consumer needs, wants, and motivations and thereby devise the most appropriate mix for his market. Then, to the marketer the dynamic nature of consumer behaviour implies rapid product development, changing communications, and distribution strategies in order to be more effective. It is this (marketing) concept, as articulated by several marketing scholars (e.g., Alderson 1965; Bagozzi 1975; Kotler 1972; Kotler and Levy 1969) that captures many of the more essential characteristics of modern marketing which has tended to dominate thinking in the field. Those whose research motivation is consumer influence largely embrace the research paradigm of positivism in which rigorous empirical techniques are used to discover generalizable explanations and laws. Consumer decision making processes and behavioural outcomes are studied to bring about prediction and change (Ozanne and Hudson 1989). However, the arena of consumer research goes far beyond the managerial perspective, when primary focus is placed on consumption. Holbrook and Hirschman (1982), among others, strongly advocate that the purchase decision is only a small component in the constellation of events involved in the consumption experience. Holbrook (1987) suggests that consumer researchers must expand their view to examine all facets of the value potentially provided when some living organism acquires, uses, or

disposes of any product that might achieve a goal, fulfill a need, or satisfy a want. The decision process then assumes secondary importance as compared with consumption. This broadened perspective has been recently reflected in the literature, as published research focuses on the subjective aspects of the consumption experience, such as hedonic consumption. Research methodology moves beyond positivism to naturalism (ethnography, semiotics, literary criticism, and historicism) in order to achieve a broader understanding of the impact of consumption on the consumer without any particular intent to change or influence the process. While some outcomes may be significant to marketing practice the overall goal of such research endeavour is to achieve better understanding of consumer behaviour.

REVIEW OF LITERATURE
Consumer Behaviour: a Literature Review Consumer Behaviour: a Literature Review In order to develop a framework for the study consumer behaviour it is helpful to begin by considering the evolution of the field of consumer research and the different paradigms of thought that have influenced the discipline. As described in this article, a set of dimensions can be identified in the literature, which can be used to characterize and differentiate, the various perspectives on consumer research. It is argued that consumer behaviour itself emerged as a distinct field of study during the 1960s; and is characterized by two broad paradigms, the positivist and the non-positivist. The positivist paradigm encompasses the economic, behavioural, cognitive, motivational/trait/attitudinal, and situational perspectives; these perspectives are referred to as the traditional perspectives as they pre-date the

development of the non-positivist paradigm. The positivist paradigm, which is still the dominant paradigm, emphasizes the supremacy of human reason and that there is a single, objective truth that can be discovered by science. This paradigm regards the world as a rational and ordered place with a clearly defined past, present, and future. The assumption of rationalism is therefore fundamental to the traditional perspective. The opposing, non-positivist paradigm, envelops the interpretive and postmodern perspectives, which have emerged more recently during the period post-1980 to date. The proponents of this emerging perspective argue that positivism overemphasizes the rational view and the ideology of a homogenous social culture and thereby denies the complex social and cultural world in which consumers live. This paradigm instead stresses, the importance of symbolic and subjective experience and the idea that consumers construct meanings based on unique and shared cultural experiences, and thus there can be no single unified world view. Unsurprisingly, the two paradigms differ in their views on the benefits derived from consumption and the objectives that underscore consumer research. The traditional, positivist perspective takes a very utilitarian approach to the benefits from consumption. While the non-positivist perspectives place much greater emphasis on the symbolic dimensions of choice. The objective of non-positivist research endeavour is to achieve a better understanding of consumer behaviour with no specific intent to influence consumer processes. Conversely, outcomes of positivist research are directed toward advancing the goals of marketing practice. By identifying the paradigmatic shifts within the field, this article aims to identify different streams of thought that could guide future consumer research.

Chapter 2 Company profile


Company Profile

Today the group operates through 4 key sectors:

Consumer Electronics and Home Appliances


Videocon Industries Limited manufacture, assemble and distribute a comprehensive range of consumer electronics, products and home appliances, including finished goods such as television, Home entertainment systems, refrigerators, Washing machines, Air Conditioners and other small household appliances and components such as glass shell(panels & funnels), compressors, motors etc.

Oil and Gas


In the domestic oil & gas business, the Group has interests in exploration, prospecting and an intention to get into gas distribution. Beyond borders, Videocon is displaying considerable entrepreneurial flair by becoming active in bagging exploration and production in countries like Brazil, Mozambique, East Timor, Indonesia and Australia.This gives the Group hegemonic status in those countries along with the possibility of earning extraordinary profits.

Power Business
The Company is developing the Pipavav power project through a wholly- owned subsidiary of the Company, Pipavav Energy Private Limited. The Project is designed to have a capacity of 1200 MW and comprises two units of 600 MW each. The Company is also developing the Chhattisgarh power project through a wholly- owned subsidiary of the Company, Chhattisgarh Power Ventures Private Limited. The Chhattisgarh power project is designed to have a capacity of 1200 MW and comprises two units of 600 MW each.

Telecommunication
Videocon Group operate the GSM mobile services through Videocon Telecommunications Limited (VTL). VTL was granted a licence by the Government of India to provide unified access services in the following 21 circles in India: Delhi, Mumbai, Tamil Nadu, Chennai, Kolkata, Maharashtra, Gujrat, Andhra Pradesh, Karnataka, Kerala, Haryana,

Uttar Pradesh(West), Uttar Pradesh (East), Rajasthan, Madhya Pradesh, West Bengal, Himachal Pradesh, , Bihar,

Vision & Mission

Orissa, Assam, North East, Jammu & Kashmir.

To delight and deliver beyond expectation through ingenious strategy, intrepid entrepreneurship, improved technology, innovative products, insightful marketing and inspired thinking about the future.
A breakdown of the statement above reveals a means and end approach, where the end is articulated at the beginning with the means linked to it.

To delight and deliver beyond expectation: the end


This segment not only underlines the importance of the ultimate goal - customer satisfaction (delight) and ultimate target - the customer, but also of intermediate processes and principals, which have contributed to building a robust, dependable Videocon value chain (deliver). As a result of its focus on developing loyal customers and reliable associates, Videocon is able to exceed expectations.

through ingenious strategy: the means


In the cutthroat world of today, it is only by taking recourse to advance planning and strategy that a business can hope to survive. Although textbook strategy has its uses, reproducing it in verbatim for the real world would be foolish because of the absence of textbook conditions. Thus, there is a need for a bounded rationality, a spontaneity and improvisation that is flexible enough for scenarios both imaginable and unimaginable. Videocons ingenious manoeuvres are actually flexi-strategy that abstracts from shifting ground conditions and decides gameplans, or sometimes changes the rules of the game.

intrepid entrepreneurship: the means


An enterprise with the odds stacked against it makes great business sense. This is because higher the obstacles, lower the number of players likely to be active in that field - thus, fetching extraordinary returns. The only requirement is a bold and confident attitude willing to brave the odds. Videocons foray into oil and gas is a bold and intrepid endeavour that arises from immense faith on the surefooted competence of the companys in-house managerial talent.

improved technology: the means


Technology is no more a premium input; it has become the bare minimum in recent years. Rapid advances have only fuelled this phenomenon. Videocon is extremely vigilant in shunting out dated technology and replacing it with the best-in-class offers of the times.

innovative products: the means


Product development, innovation and customisation are the tools Videocon uses to stay ahead of the competition. This is because a continuous stream of innovative products excites the market and enhances brand recall. A strategy that Videocon banks on a lot, especially on the domestic front.

insightful marketing: the means


The market share battle scene has long shifted from technology and processes to the psyche of the customer. This means that those with deeper insights into the elusive mind of the buyer are likely to dominate. Videocon is reinforcing marketing strengths to read better the pulse of the market and help create products that map perfectly into customer preferences.

inspired thinking about the future.: the means


The future is unpredictable, but not doing anything about it is fraught with grave risk. Videocon extrapolates future trends on the basis of current changes in technology and preferences as well as sheer gut feel. Fine-tuned business instincts are worth their weight in gold, lots of it. The company has perfected its practice almost into an art form with some calculated gambles like oil and gas proving to be absolute money-spinners.

Chairman
Personal Profile
Name Address - Office Venugopal Nandlal Dhoot Videocon Industries Ltd. Fort House, 2nd Floor 221, Dr. D. N. Road Mumbai 400 001 Tel: 091-22-66113500 Fax: 091-22-66551985 [email protected] Date of birth Qualifications Hobbies/Interest Present Position Other Achievements 30.09.1951 B.E. (Electricals), FIE. Flute recital & discourse on Bhagwad-Gita Chairman & Managing Director Videocon Industries Limited a) Past President - The Associated Chambers of Commerce and Industry of India (ASSOCHAM) b) President Electronic Industries Association of Marathwada c) Member of Advisory Committee of Poona University Information Employment & Guidance. d) Adviser to Govt. of Orissa for Industrial Development of Orissa

Venugopal N Dhoot

Milestones
History
View Videocon at a glance

Employee Code of Conduct


Videocon Industries Limited set forth principles for as working with Employees, Stakeholders and Customers. The Code of Conduct acts a perpetual reminder of organizations accountability to build interpersonal relations based on Integrity, Honesty, Transparency and Dignity of Human Beings. To be an ethical values company, everyone must practice in the process of ensuring business to be an ideal one.

Applicability of this code


This Code of Conduct shall be applicable and binding on all employees while interacting on company's business activities with other employees, stakeholders, customers, vendors, dealers and distributors, suppliers, contractors of this Organization.

1. Accountability of an employee
It is essential to operate our business/operations in the most ethical and professional manner.

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An employee is expected to adhere, adopt and adapt the practices in business ethics many of these practices attracts legal / regulatory requirements. Violation of the laws applicable can create significance damage / liability for you /company or even to other employees. We expect the employees to scrupulously carry the accountability and comply.

2. Conflict of interest
A "conflict of interest' occurs when:

Personal interest: - The personal interest of any member of the Board of Directors or the Senior Management interferes or appears to interfere in any way with the interest of the Company. Although this duty does not prevent them from engaging in personal transactions and investments, it does demand that they avoid situations where conflict of interest might occur or appear to occur. Involvement/Interference: - The Non-Executive Directors and the Senior Management are expected to devote their attention to the business interest of the Company. They are prohibited from engaging in any activity that interferes with their performance or responsibilities to the Company or otherwise is in conflict with or prejudicial to the Company. Business Interests: - If any member of the Board of Directors or the Senior Management considers investing in securities issued by the Company's customer, supplier or competitor, they should ensure that these investments do not compromise their responsibilities to the Company. Many factors including the size and nature of the investment; their ability to influence the Company's decisions, their access to confidential information of the Company, or of the other entity, and the nature of the relationship between the Company and the customer, supplier or competitor should be considered in determining whether a conflict exists. Additionally, they should disclose to the Company any interest that they have which may conflict with business of the Company.

3. Use of assets and information confidentiality


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Ensure use of facilities and amenities provided to him / her by the company with care. Return the company property while leaving the company on discharge / termination / resignation. Not to disclose business strategies / operations to anyone. Not to take away critical document / information either physically or through emails. Company's Email, Internal and Intranet are primarily use for company's business and not for personal gains. Not to send or browse discriminatory / obscene / objectionable pictures or matter.

4. Expense reports
Each employee will conduct Company's business with integrity, in compliance with applicable laws and rules, and in a manner that excludes personal gain.

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As per policy, employees would be reimbursed for expenses that are necessary and actually incurred when travelling and/or entertaining on authorized Company business. It is the responsibility of the employees to submit timely and accurate expense reports in compliance with applicable policy. Those authorized to approve expense reports are charged with ensuring that expenses submitted are in full accordance with the Company's policies, procedures and guidelines. Failure to file an expense report to account for Company funds, or submitting or approving false information can result in strict disciplinary action.

5. Intellectual property
Videocon and its employees must respect the intellectual property rights of others and take care to protect and maintain its intellectual property.

"Intellectual Property" includes creative works, the owners of which have legal rights to them and include copyrights, patents, trade secrets and trademarks. Violation can result in substantial liability and in some instances, may even be criminal in nature. Any misuse, whether inside the Company or outside, of the Corporate Logo, Channel Logos, Stationery formats etc., must be promptly reported to Legal.

It is therefore very important that all Videocon's personnel take care not only to protect our intellectual property rights, but also avoid violating the rights of others.

6. General standards of conduct


The Company expects all Directors and the Senior Management to exercise:

Good judgment, to ensure the interests, safety and welfare of customers, dealers, employees, and other stakeholders and to maintain a co-operative, efficient, positive, harmonious and productive work environment. While discharging duties employee must act honestly and with due diligence, which an ordinary person is expected to behave in his/her own business. These standards need to be applied while working in the premises of the Company, at off-site locations where the business is being conducted whether in India or abroad, at Company-Sponsored business and social events, or at any other place whether they act as representatives of the Company. Maintain and help the Company in maintaining highest degree of Corporate Governance Practices. Shall not communicate with any member of press or publicity media or any other outside agency on matters concerning the Company, except through the designated spokespersons or otherwise authorized.

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7. Sexual Harassment
Sexual Harassment is forbidden by law and by a specific policy in Videocon. Claims will be promptly investigated and resolved. All efforts will be taken to maintain confidentiality and information will be revealed only on a "need to know" basis.

8. It is expected that employees would be dressed in business attire on duty. 9. Zero tolerance to misconduct
All employees, vendors, dealers and distributors, suppliers, contractors of this Organization are expected to observe the highest standards of ethics during performance of their services so as to avoid misconduct. For the purposes of this provision, Videocon defines 'misconduct' as under:

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Corrupt Practice' is the offering, giving, receiving or soliciting, directly or indirectly, of anything of value to influence improperly the actions of another party. 'Fraudulent Practice' is any act or omission, including a misrepresentation, that knowingly or recklessly misleads, or attempts to mislead, a party to obtain a financial or other benefit or to avoid an obligation. 'Collusive Practice' is an arrangement between two or more parties designed to achieve an improper purpose, including to influence improperly the actions of another party. 'Coercive Practices' is impairing or harming, or threatening to impair or harm, directly or indirectly, any party or the property of the party to influence improperly the actions of a party.

10. Report Violations


It is collective responsibility of all employees & business associates (dealers, distributers, channel partners etc) to promptly report all known or suspected violations of Code of Conduct or applicable laws and other policies, procedures, and guidelines prepared by the Company. Such violations can be reported via e-mail [email protected] This e-mail address is being protected from spambots. You need JavaScript enabled to view it . In case, a respondent do not want to disclose his/her identity, they can do so.

11. Disciplinary action


The Company intends to prevent the occurrence of conduct not in compliance with this Code of Conduct, applicable laws and other policies, procedures, and guidelines prepared by the Company. The allegations of non-compliance or reported violations with the Code of Conduct will be investigated whenever necessary and evaluated at proper level(s). Those found to be in violation of this Code of Conduct are subject to appropriate actions up to and including termination of employment / future business with the company. Criminal misconduct may be referred to the appropriate legal authorities as per Law.

Consumer Research Methods


Market research is often needed to ensure that we produce what customers really want and not what we think they want. Primary vs. secondary research methods. There are two main approaches to marketing. Secondary research involves using information that others have already put together. For example, if you are thinking about starting a business making clothes for tall people, you dont need to question people about how tall they are to find out how many tall people existthat information has already been published by the U.S. Government. Primary research, in contrast, is research that you design and conduct yourself. For example, you may need to find out whether consumers would prefer that your soft drinks be sweater or tarter. Research will often help us reduce risks associated with a new product, but itcannot take the risk away entirely. It is also important to ascertain whether the research has been complete. For example, Coca Cola did a great deal of research prior to releasing the New Coke, and consumers seemed to prefer the taste. However, consumers were not prepared to have this drink replace traditional Coke. Secondary Methods. For more information about secondary market researchtools and issues, please see my handout. Primary Methods. Several tools are available to the market researchere.g., mail questionnaires, phone surveys, observation, and focus groups. Please seemy handout for advantages and disadvantages of each. The below flow chartsuggests appropriate choices for different types of information needs.

Please click for a larger chart... Surveys are useful for getting a great deal of specific information. Surveys can contain open-ended questions (e.g., In which city and state were you born? ____________) or closed-ended, where the respondent is asked to select answers from a brief list (e.g., __Male ___ Female. Open ended questions have the advantage that the respondent is not limited to the options listed, and that the respondent is not being influenced by seeing a list of responses. However, openended questions are often skipped by respondents, and coding them can be quite a challenge. In general, for surveys to yield meaningful responses, sample sizes of over 100 are usually required because precision is essential. For example, if a market share of twenty percent would result in a loss while thirty percent would be profitable, a confidence interval of 20-35% is too wide to be useful. Surveys come in several different forms. Mail surveys are relatively inexpensive, but response rates are typically quite lowtypically from 5-20%. Phone-surveys get somewhat higher response rates, but not many questions can be asked because many answer options have to be repeated and few people are willing to stay on the phone for more than five minutes. Mall intercepts are a convenient way to reach consumers, but respondents may be reluctant to discuss anything sensitive face-toface with an interviewer.

Surveys, as any kind of research, are vulnerable to bias. The wording of a question can influence the outcome a great deal. For example, more people answered no to the question Should speeches against democracy be allowed? than answered yes to Should speeches against democracy be forbidden? For face-to-face interviews, interviewer bias is a danger, too. Interviewer bias occurs when the interviewer influences the way the respondent answers. For example, unconsciously an interviewer that works for the firm manufacturing the product in question may smile a little when something good is being said about the product and frown a little when something negative is being said. The respondent may catch on and say something more positive than his or her real opinion. Finally, a response bias may occurif only part of the sample responds to a survey, the respondents answers may not be representative of the population. Focus groups are useful when the marketer wants to launch a new product or modify an existing one. A focus group usually involves having some 8-12 people come together in a room to discuss their consumption preferences and experiences. The group is usually led by a moderator, who will start out talking broadly about topics related broadly to the product without mentioning the product itself. For example, a focus group aimed at sugar-free cookies might first address consumers snacking preferences, only gradually moving toward the specific product of sugar-free cookies. By not mentioning the product up front, we avoid biasing the participants into thinking only in terms of the specific product brought out. Thus, instead of having consumers think primarily in terms of what might be good or bad about the product, we can ask them to discuss more broadly the ultimate benefits they really seek. For example, instead of having consumers merely discuss what they think about some sugar-free cookies that we are considering releasing to the market, we can have consumers speak about their motivations for using snacks and what general kinds of benefits they seek. Such a discussion might reveal a concern about healthfulness and a desire for wholesome foods. Probing on the meaning of wholesomeness, consumers might indicate a desire to avoid artificial ingredients. This would be an important concern in the marketing of sugar-free cookies, but might not have come up if consumers were asked to comment directly on the product where the use of artificial ingredients is, by virtue of the nature of the product, necessary. Focus groups are well suited for some purposes, but poorly suited for others. In general, focus groups are very good for getting breadthi.e., finding out what kinds of issues are important for consumers in a given product category. Here, it is helpful that focus groups are completely open-ended: The consumer mentions his or her preferences and opinions, and the focus group moderator can ask the consumer to elaborate. In a questionnaire, if one did not think to ask about something, chances are that few consumers would take the time to write out an elaborate answer. Focus groups also have some drawbacks, for example:

They represent small sample sizes. Because of the cost of running focus groups, only a few groups can be run. Suppose you run four focus groups with

ten members each. This will result in an n of 4(10)=40, which is too small to generalize from. Therefore, focus groups cannot give us a good idea of: What proportion of the population is likely to buy the product. What price consumers are willing to pay. The groups are inherently social. This means that: Consumers will often say things that may make them look good (i.e., they watch public television rather than soap operas or cook fresh meals for their families daily) even if that is not true. Consumers may be reluctant to speak about embarrassing issues (e.g., weight control, birth control).

Personal interviews involve in-depth questioning of an individual about his or her interest in or experiences with a product. The benefit here is that we can get really into depth (when the respondent says something interesting, we can ask him or her to elaborate), but this method of research is costly and can be extremely vulnerable to interviewer bias. To get a person to elaborate, it may help to try a common tool of psychologists and psychiatristssimply repeating what the person said. He or she will often become uncomfortable with the silence that follows and will then tend to elaborate. This approach has the benefit that it minimizes the interference with the respondents own ideas and thoughts. He or she is not influenced by a new question but will, instead, go more in depth on what he or she was saying. Personal interviews are highly susceptible to inadvertent signaling to the respondent. Although an interviewer is looking to get at the truth, he or she may have a significant interest in a positive consumer response. Unconsciously, then, he or she may inadvertently smile a little when something positive is said and frown a little when something negative is said. Consciously, this will often not be noticeable, and the respondent often will not consciously be aware that he or she is being reinforced and punished for saying positive or negative things, but at an unconscious level, the cumulative effect of several facial expressions are likely to be felt. Although this type of conditioning will not get a completely negative respondent to say all positive things, it may swing the balance a bit so that respondents are more likely to say positive thoughts and withhold, or limit the duration of, negative thoughts. Projective techniques are used when a consumer may feel embarrassed to admit to certain opinions, feelings, or preferences. For example, many older executives may not be comfortable admitting to being intimidated by computers. It has been found that in such cases, people will tend to respond more openly about someone else. Thus, we may ask them to explain reasons why a friend has not yet bought a computer, or to tell a story about a person in a picture who is or is not using a product. The main problem with this method is that it is difficult to analyze responses.

Projective techniques are inherently inefficient to use. The elaborate context that has to be put into place takes time and energy away from the main question. There may also be real differences between the respondent and the third party. Saying or thinking about something that hits too close to home may also influence the respondent, who may or may not be able to see through the ruse. Observation of consumers is often a powerful tool. Looking at how consumers select products may yield insights into how they make decisions and what they look for. For example, some American manufacturers were concerned about low sales of their products in Japan. Observing Japanese consumers, it was found that many of these Japanese consumers scrutinized packages looking for a name of a major manufacturerthe product specific-brands that are common in the U.S. (e.g., Tide) were not impressive to the Japanese, who wanted a name of a major firm like Mitsubishi or Proctor & Gamble. Observation may help us determine how much time consumers spend comparing prices, or whether nutritional labels are being consulted. A question arises as to whether this type of spying inappropriately invades the privacy of consumers. Although there may be cause for some concern in that the particular individuals have not consented to be part of this research, it should be noted that there is no particular interest in what the individual customer being watched does. The question is what consumerseither as an entire group or as segmentsdo. Consumers benefit, for example, from stores that are designed effectively to promote efficient shopping. If it is found that women are more uncomfortable than men about others standing too close, the areas of the store heavily trafficked by women can be designed accordingly. What is being reported here, then, are averages and tendencies in response. The intent is not to find juicy observations specific to one customer. The video clip with Paco Underhill that we saw in class demonstrated the application of observation research to the retail setting. By understanding the phenomena such as the tendency toward a right turn, the location of merchandise can be observed. It is also possible to identify problem areas where customers may be overly vulnerable to the but brush, or overly close encounter with others. This method can be used to identify problems that the customer experiences, such as difficulty finding a product, a mirror, a changing room, or a store employee for help. Online research methods. The Internet now reaches the great majority of households in the U.S., and thus, online research provides new opportunity and has increased in use. One potential benefit of online surveys is the use of conditional branching. In conventional paper and pencil surveys, one question might ask if the respondent has shopped for a new car during the last eight months. If the respondent answers no, he or she will be asked to skip ahead several questionse.g., going straight to question 17 instead of proceeding to number 9. If the respondent answered yes, he or she would be instructed to go to the next question which, along with the next

several ones, would address issues related to this shopping experience. Conditional branching allows the computer to skip directly to the appropriate question. If a respondent is asked which brands he or she considered, it is also possible to customize brand comparison questions to those listed. Suppose, for example, that the respondent considered Ford, Toyota, and Hyundai, it would be possible to ask the subject questions about his or her view of the relative quality of each respective pairin this case, Ford vs. Toyota, Ford vs. Hyundai, and Toyota vs. Hyundai. There are certain drawbacks to online surveys. Some consumers may be more comfortable with online activities than othersand not all households will have access. Today, however, this type of response bias is probably not significantly greater than that associated with other types of research methods. A more serious problem is that it has consistently been found in online research that it is very difficultif not impossibleto get respondents to carefully read instructions and other information onlinethere is a tendency to move quickly. This makes it difficult to perform research that depends on the respondents reading of a situation or product description. Online search data and page visit logs provides valuable ground for analysis. It is possible to see how frequently various terms are used by those who use a firms web site search feature or to see the route taken by most consumers to get to the page with the information they ultimately want. If consumers use a certain term frequently that is not used by the firm in its product descriptions, the need to include this term in online content can be seen in search logs. If consumers take a long, torturous route to information frequently accessed, it may be appropriate to redesign the menu structure and/or insert hyperlinks in intermediate pages that are found in many users routes. Scanner data. Many consumers are members of supermarket clubs. In return for signing p for a card and presenting this when making purchases, consumers are often eligible for considerable discounts on selected products. Researchers use a more elaborate version of this type of program in some communities. Here, a number of consumers receive small payments and/or other incentives to sign up to be part of a research panel. They then receive a card that they are asked to present any time they go shopping. Nearly all retailers in the area usually cooperate. It is now possible to track what the consumer bought in all stores and to have a historical record. The consumers shopping record is usually combined with demographic information (e.g., income, educational level of adults in the household, occupations of adults, ages of children, and whether the family owns and rents) and the familys television watching habits. (Electronic equipment run by firms such as A. C. Nielsen will actually recognize the face of each family member when he or she sits down to watch).

It is now possible to assess the relative impact of a number of factors on the consumers choicee.g.,

What brand in a given product category was bought during the last, or a series of past, purchase occasions; Whether, and if so, how many times a consumer has seen an ad for the brand in question or a competing one; Whether the target brand (and/or a competing one) is on sale during the store visit; Whether any brand had preferential display space; The impact of income and/or family size on purchase patterns; and Whether a coupon was used for the purchase and, if so, its value.

A split cable technology allows the researchers to randomly select half the panel members in a given community to receive one advertising treatment and the other half another. The selection is truly random since each household, as opposed to neighborhood, is selected to get one treatment or the other. Thus, observed differences should, allowing for sampling error, the be result of advertising exposure since there are no other systematic differences between groups. Interestingly, it has been found that consumers tend to be more influenced by commercials that they zap through while channel surfing even if they only see part of the commercial. This most likely results from the reality that one must pay greater attention while channel surfing than when watching a commercial in order to determine which program is worth watching.

Scanner data is, at the present time, only available for certain grocery item product categoriese.g., food items, beverages, cleaning items, laundry detergent, paper towels, and toilet paper. It is not available for most non-grocery product items. Scanner data analysis is most useful for frequently purchased items (e.g., drinks, food items, snacks, and toilet paper) since a series of purchases in the same product category yield more information with greater precision than would a record of one purchase at one point in time. Even if scanner data were available for electronic products such as printers, computers, and MP3 players, for example, these products would be purchased quite infrequently. A single purchase, then, would not be as effective in effectively distinguishing the effects of different factorse.g., advertising, shelf space, pricing of the product and competitors, and availability of a couponsince we have at most one purchase instance during a long period of time during which several of these factors would apply at the same time. In the case of items that are purchased frequently, the consumer has the opportunity to buy a product, buy a competing product, or buy nothing at all depending on the status of the brand of interest and competing brands. In the case of the purchase of an MP3 player, in contrast, there may be promotions associated with several brands going on at the same time, and each may advertise. It may also be that the purchase was motivated by the breakdown of an existing product or dissatisfaction or a desire to add more capabilities. Physiological measures are occasionally used to examine consumer response. For example, advertisers may want to measure a consumers level of arousal during various parts of an advertisement. This can be used to assess possible discomfort on the negative side and level of attention on the positive side. By attaching a tiny camera to plain eye glasses worn by the subject while watching an advertisement, it is possible to determine where on screen or other ad display the subject focuses at any one time. If the focus remains fixed throughout an ad sequence where the interesting and active part area changes, we can track whether the respondent is following the sequence intended. If he or she is not, he or she is likely either not to be paying as much attention as desired or to be confused by an overly complex sequence. In situations where the subjects eyes do move, we can assess whether this movement is going in the intended direction. Mind-reading would clearly not be ethical and is, at the present time, not possible in any event. However, it is possible to measure brain waves by attaching electrodes. These readings will not reveal what the subject actually thinks, but it is possible to distinguish between beta wavesindicating active thought and analysis and alpha waves, indicating lower levels of attention. An important feature of physiological measures is that we can often track performance over time. A subject may, for example, be demonstrating good characteristicssuch as appropriate level of arousal and eye movementduring some of the ad sequence and not during other parts. This, then, gives some guidance as to which parts of the ad are effective and which ones need to be reworked.

In a variation of direct physiological measures, a subject may be asked, at various points during an advertisement, to indicate his or her level of interest, liking, comfort, and approval by moving a lever or some instrument (much like one would adjust the volume on a radio or MP3 player). Republican strategist used this technique during the impeachment and trial of Bill Clinton in the late 1990s. By watching approval during various phases of a speech by the former President, it was found that viewers tended to respond negatively when he referred to speaking truthfully but favorably when the President referred to the issues in controversy as part of his private life. The Republican researchers were able to separate average results from Democrats, Independents, and Republicans, effectively looking at different segments to make sure that differences between each did not cancel out effects of the different segments. (For example, if at one point Democrats reacted positively and Republicans responded negatively with the same intensity, the average result of apparent indifference would have been very misleading). Research sequence. In general, if more than one type of research is to be used, the more flexible and less precise methodsuch as focus groups and/or individual interviewsshould generally be used before the less flexible but more precise methods (e.g., surveys and scanner data) are used. Focus groups and interviews are flexible and allow the researcher to follow up on interesting issues raised by participants who can be probed. However, because the sample sizes are small and because participants in a focus group are influenced by each other, few data points are collected. If we run five focus groups with eight people each, for example, we would have a total of forty responses. Even if we assume that these are independent, a sample size of forty would give very imprecise results. We might conclude, for example, that somewhere between 5% and 40% of the target market would be interested in the product we have to offer. This is usually no more precise than what we already reasonably new. Questionnaires, in contrast, are highly inflexible. It is not possible to ask follow-up questions. Therefore, we can use our insights from focus groups and interviews to develop questionnaires that contain specific questions that can be asked to a larger number of people. There will still be some sampling error, but with a sample size of 1,000+ responses, we may be able to narrow the 95% confidence interval for the percentage of the target market that is seriously interested in our product to, say, 17-21%, a range that is much more meaningful. Cautions. Some cautions should be heeded in marketing research. First, in general, research should only be commissioned when it is worth the cost. Thus, research should normally be useful in making specific decisions (what size should the product be? Should the product be launched? Should we charge $1.75 or $2.25?) Secondly, marketing research can be, and often is, abused. Managers frequently have their own agendas (e.g., they either would like a product to be launched or would prefer that it not be launched so that the firm will have more resources left over to tackle their favorite products). Often, a way to get your way is to demonstrate through objective research that your opinions make economic sense. One example of misleading research, which was reported nationwide in the media, involved the

case of The Pentagon Declares War on Rush Limbaugh. The Pentagon, within a year of the election of Democrat Bill Clinton, reported that only 4.2% of soldiers listening to the Armed Forces Network wanted to hear Rush Limbaugh. However, although this finding was reported without question in the media, it was later found that the conclusion was based on the question What single thing can we do to improve programming? If you did not write in something like Carry Rush Limbaugh, you were counted as not wanting to hear him.

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