Unit- 1

Consumer behavior- scope,

importance and interdisciplinary nature
What is Consumer Behavior?

Those activities directly involved in obtaining ,

consuming and disposing of products and services,
including the decision processes that precede and
follow these actions.
Customer and consumer

Customer- Refers to someone who regularly

purchase from a particular store or a company.

Consumer- Refers to anyone engaging in any of

the activities used in our definition of consumer
behavior.
The ultimate consumer- Those individuals who
purchase for the purpose of individual or household
consumption.

Individual buyer- An individual making a purchase with

little or no influence from others.
Importance of Consumer behavior:
• Ever increasing intensifying competition.
• More aggressive competitors emerging with greater
frequency.
• Changes basis of competition.
• Geographic sources of competition are becoming
wider.
• Niche attacks are becoming frequent.
• Pace of innovation is rapid.
• Price competition becoming more aggressive
• Product differentiation is declining.
This study draws on concepts from
various other disciplines

 Psychology
 Sociology
 Anthropology
 Economics
 Marketing
Consumer research process
Consumer Research :
 Consumer research is the systematic collection and analysis of consumer
information for the purpose of important decision making for marketing.
Consumer research plays an important role in marketing process, helps in
consumer measurement, market potential, sales forecast, each element like
product mix, distribution mix, price, effectiveness of and advertisement
campaign, consumer acceptance of a product. In competitive situation, it is
extremely critical for and organization to monitor the customer
relationship on a regular basis.

Consumer research is used for two purposes:

• Routine problem analysis .i.e. product potential, sales forecasting.

• Non-routing problem analysis .i.e. new product launch, success of

promotional schemes.
Types of Data:

Primary Data: Data collected at first hand either by

the researcher or by someone especially for the
purpose of the study are known as primary data.

Secondary Data: Data which have been collected

earlier for some other purpose are secondary data in
hands of marketing researcher.
Quantitative Research

 Descriptive in nature.
 Enables marketers to “predict” consumer
behavior.
 Research methods include experiments, survey
techniques, and observation.
 Findings are descriptive, empirical and
generalizable.
 Positivism

A consumer behavior research approach

that regards the consumer behavior
discipline as an applied marketing
science.
Qualitative Research

 Consists of depth interviews, focus

groups, metaphor analysis and projective
techniques.
 Administered by highly trained
interviewer-analysts.
 Findings tend to be subjective.
 Small sample sizes.
 Interpretivism

A postmodernist approach to the study of

consumer behavior that focuses on the act
of consuming rather than on the act of
buying.
Comparisons between Positivism and
Interpretivism

PURPOSE
Positivism Interpretivism

Prediction of consumer Understanding consumption

actions practices
METHODOLOGY
Positivism Interpretivism

Quantitative Qualitative
The Consumer Research Process

 Six steps
◦ defining the objectives of the research
◦ collecting and evaluating secondary data
◦ designing a primary research study
◦ collecting primary data
◦ analyzing the data
◦ preparing a report on the findings
 The Consumer Research Process

Develop Objectives

Collect Secondary Data

Design Qualitative Research Design Quantitative Research

• Method • Method
• Screener questionnaire • Sample design
• Discussion guide • Data collection instrument

Conduct Research
Collect Primary Data
(Using highly trained
(Usually by field staff)
interviewers) Exploratory
Study
Analyze Data Analyze Data
(Subjective) (Objective)

Prepare Report Prepare report

 Developing Research Objectives

 Defining purposes and objectives helps ensure

an appropriate research design.
 A statement of objectives helps to define the
type and level of information needed.
Secondary Versus Primary Data

 Secondary data: data  Primary data: data

that has been collected by the
collected for reasons researcher for the
other than the purpose of meeting
specific research specific objectives
project at hand
Table 2.2 Major Sources of Secondary Data

Periodicals
Government
&
Publications
Books
Internal Commercial
Sources Data
Quantitative Research Design

Observation

Experimentation

Surveys
 Observational Research

 Helps marketers gain an in-depth understanding of

the relationship between people and products by
watching them buying and using products.
 Helps researchers gain a better understanding of
what the product symbolizes.
 Widely used by interpretivist researchers.
 Experimentation

 Can be used to test the relative sales

appeal of many types of variables.
 Only one variable is manipulated at a time,
keeping other elements constant.
 Can be conducted in laboratories or in the
field.
Survey Data Collection Methods

Personal Interview

Mail

Telephone

Online
Comparative Advantages

PERSONAL
MAIL TELEPHONE ONLINE
INTERVIEW
Cost Low Moderate High Low
Speed Slow Immediate Slow Fast
Response Self-
Low Moderate High
rate selection
Geographic
Excellent Good Difficult Excellent
flexibility
Interviewer
N/A Moderate Problematic N/A
bias
Interviewer
N/A Easy Difficult N/A
supervision
Quality of
Limited Limited Excellent Excellent
response
 Quantitative Research data
collection instruments
 Questionnaires
 Attitude Scales
Likert Scale
Semantic Differential Scale
Behavior Intention Scale
Rank-order Scale
Attitude Scales

 Likert scales: easy for researchers to

prepare and interpret, and simple for
consumers to answer.
 Rank-order scales: subjects rank items in
order of preference in terms of some
criteria.
Example of a Likert Scale

Please place the number that best indicates how strongly you agree or
disagree with each of the following statements about shopping online in
the space to the left of the statement.

1 = Agree Strongly
2 = Agree
3 = Neither Agree or Disagree
4 = Disagree
5 = Disagree Strongly

_____ a. It is fun to shop online.

_____ b. Products often cost more online.
_____ c. It is a good way to find out about new products.
Rank-Order Scales

Rank the following computer manufacturers in terms of

hotline help by placing a 1 next to the one who provides
the best telephone help, a 2 next to the second best, until
you have ranked all six.

_____ IBM _____Hewlett Packard

_____ Dell _____ Gateway
_____ Compaq _____ NEC
Qualitative Research Design and Data Collection
Methods

Depth Focus
Interviews Groups

Projective
Techniques
 A qualitative research
method in which eight
to ten persons
Focus Group participate in an
unstructured group
interview about a
product or service
concept.
 Research procedures
designed to identify
consumers’ subconscious
Projective feelings and motivations.
Techniques Such as incomplete
sentences, untitled
pictures, word
association test and other
person characterization.
Sampling Plan Decisions

Whom to
survey?

How many?

How to
select them?