Consumer behavior

• Consumer behavior is the study of how people are making purchase decisions to
satisfy their needs, wants or desires, and how their emotional, mental, and
behavioral responses influence the buying decision.

• Consumer behavior is the study of the elements that influence individuals’ purchasing
decisions, including environmental, psychological, and societal factors.
 Study of CB
• Marketers who study consumers’ behavior
patterns often find they are successful in using
this information not only to attract new
customers, but they’re also successful in using it
to retain their current clientele.

• As such, to be successful in this field, marketing

professionals must gain a deep understanding of
what drives consumer behavior, including
the psychological, personal, and social factors
that influence purchasing decisions.
• To delve deeper into the preferences of your target audience,
some of the questions you must answer are:

• How do the consumers perceive the information?

• How do you capture their attention?
• What are their needs?
• What factors influence them to make a purchase decision? Are
they price, quality, commercial offer, others?
Tactical approach of H&M
• For example, clothing retailer H&M
took a tactical approach to its digital
marketing efforts when it partnered with
model Ela Velden and fashion blogger
Julie Sariñana to showcase its clothing
on Instagram.

• The goal of the widely successful

campaign was to tap into consumers’
tendency to trust industry experts. In
this instance, H&M wanted to target
millennials and Generation Z, knowing
that a social media influencer campaign
would likely resonate.
 Why is consumer behavior so important?
• Better marketing and communications
• Improve customer retention
• Increase customer loyalty
• Better plan inventory
• Increase sales
• Research competition
• Is the customer already using a competitor brand?
• What drives a consumer to buy from your competitor?
• Are potential customers happy with the competitor brands?
• What are the gaps between your products and that of
competitors?
 FACTORS INFLUENCING CONSUMER BEHAVIOUR

• Personal factors: an individual’s interests and opinions can be influenced by

demographics (age, gender, culture, etc.).
• Psychological factors: an individual’s response to a marketing message will
depend on their perceptions and attitudes.
• Social factors: family, friends, education level, social media, income, all influence
consumers’ behavior.
Situational factors
 Consumer decision-making process

• The consumer decision-making

process involves five basic steps.
This is the process by which
consumers evaluate making a
purchasing decision.

• The 5 steps are problem recognition,

information search, alternatives
evaluation, purchase decision and
post-purchase evaluation.
Roles of Consumer behavior in decision making process
 Consumer Decision-Making Models

• There are four viewpoints or models under which the customers’ approach towards the purchase
is categorized.
• These models explain that the customer can be Rational, Emotional or Practical while purchasing
the products.

• Economic Model/Economical View

• In this, the consumer makes rational purchase decisions post thorough evaluation. He himself
decides the purchase without getting influenced.
• It is assumed that the Consumer is knowledgeable and fully aware of the pros & cons. Therefore,
he is an economic buyer who takes logical and reasonable decisions.
• However, this model is unrealistic because a customer cannot be rational all the time.
 Passive Model/Passive View

• As per the passive view, the consumer purchases products due to the firm’s
marketing strategies. More precisely, it is believed that the purchase results from
the company’s advertisement and promotional campaigns.
• It is said to be the opposite of the economic view. Like the economic model, this
view is also unrealistic. As it is impossible that the Consumer only purchases due
to efforts made by the marketers.
 Cognitive Model/Cognitive View
• This model suggests that the Consumer buys products as per his understanding of
the market demand.
• He is neither rational nor influenced by the marketer’s strategies.
• It is considered to be the best among all four models.
• Because he himself computes the risks associated with the products.
 Emotional Model/ Emotional View

• Here the consumer has an emotional view while buying the product.
• He doesn’t consider the usage of the product but only focuses on the emotional
front.
• Therefore, customers become impulsive and take relatively less time in decision-
making.
Types of consumer behavior
 Consumer Behavior models
• https://blog.hubspot.com/service/consumer-behavior-model
 consumer behavior model
• A consumer behavior model is a theoretical framework for explaining why and
how customers make purchasing decisions. The goal of consumer behavior
models is to outline a predictable map of customer decisions up until conversion,
thus helping you steer every stage of the buyer’s journey.

TRADITIONAL CONSUMER BEHAVIOR MODELS CONTEMPORARY CONSUMER BEHAVIOR MODELS

Learning Model Engel-Kollat-Blackwell (EKB) Model

Psychoanalytical Model Black Box Model

Sociological Model Hawkins Stern Model

Economic Model Howard Sheth Model

Nicosia Model

Webster and Wind Model

 Learning model
The Learning Model of customer behavior theorizes that buyer behavior responds to the desire to
satisfy basic needs required for survival, like food, and learned needs that arise from lived
experiences, like fear or guilt. This model takes influence from psychologist Abraham Maslow’s
Hierarchy of Needs
 Psychoanalytical Model of Consumer Behavior

Sigmund Freud is the father of psychoanalysis. The

psychoanalytical model draws from his theories and
says that individual consumers have deep-rooted
motives, both conscious and unconscious, that drive
them to make a purchase. These motives can be hidden
fears, suppressed desires, or personal longings.
Thus, customers make purchases depending on how
stimuli from your business, like an advertisement on
Instagram, appeal to their desires. It’s important to
note that, since these desires can be unconscious,
customers don’t always know why it appeals to them;
they just know it feels right to have it.
 Sociological Model

The Sociological Model of consumer behavior says that

purchases are influenced by an individual's place within
different societal groups: family, friends, and
workgroups, as well as less-defined groups like
Millennials or people who like yoga.
An individual will essentially purchase items based on
what is appropriate or typical of the groups they’re in.
For instance, C-Suite executives are expected to be
professional and formal. People who hold these jobs
will make purchases that speak to and uphold this
group’s rules, like formal business wear.
 Economic Model of Consumer Behavior

The economic model of consumer behavior is

the most straightforward of the traditional
models. This model argues that consumers try
to meet their needs while spending as few
resources (e.g. money) as possible.
That means that businesses and manufacturers
can predict sales based on their customers’
income and their products’ price. If companies
offer the lowest-priced product, they may feel
that they’re guaranteed a consistent level of
profit.
 Engel-Kollat-Blackwell (EKB) Model of Consumer Behavior

The Engel-Kollat-Blackwell model of consumer behavior outlines a five-

stage decision process that consumers go through before purchasing a
product or service.
•Awareness: During this stage, consumers view advertisements from a
business and become aware of their need, desire, or interest, to purchase
what they've just discovered.
•Information Processing: After discovering a product or service, a
consumer begins to think about how the product or service relates to their
past experiences or needs and whether it will fulfill any current needs.
•Evaluation: At this point, consumers will research the product they’ve
discovered and research options from competitors to see if there is a better
option or if the original product is the best fit.
•Purchasing Decision: A consumer will follow through with a purchase for
the product that has beat out competitors to provide value. A consumer may
also stop the process if they change their mind.
•Outcome Analysis: After making a purchase, a customer will use what
they’ve bought and assess whether their experience is positive or negative.
After a trial period, they’ll keep a product and maybe decide to become
repeat customers or express dissatisfaction and return to stage three.

Overall, EKB says that consumers make decisions based on influencing

factors that they assess through rational insight.
 Howard Sheth Model of Buying Behavior

The Howard Sheth model of consumer behavior posits that

the buyer’s journey is a highly rational and methodical
decision-making process. In this model, customers put on a
“problem-solving” hat every step of the way — with
different variables influencing the course of the journey.
According to this model, there are three successive levels
of decision-making:
•Extensive Problem-Solving: In this stage, customers
know nothing about the product they’re seeking or the
brands that are available to them. They’re in active
problem-solving mode to find a suitable product.
•Limited Problem-Solving: Now that customers have
more information, they slow down and begin comparing
their choices.
•Habitual Response Behavior: Customers are fully aware
of all the choices they have and know which brands they
prefer. Thus, every time they make a purchase, they know
where to go.
 The Nicosia Model

The Nicosia Model places emphasis on the

business first and the consumer second. It argues
that the company’s marketing messages
determines whether customers will buy. Simple,
right?

While it’s an attractive model because it places

all the power on businesses, it’s unwise to ignore
the customer’s internal factors that lead to a
purchase decision. In other words, while you may
offer the wittiest and most effective marketing
copy ever, a customer’s internal attributes may
have more sway in some instances over others.
 The Nicosia Model
• The model is comprised of four “fields”:
• One: The business’ characteristics and the customer’s characteristics. What
does your marketing messaging look like? And what’s your customer’s perception
of that messaging? Are they predisposed to be receptive to your message? The
latter is shaped by the customer’s personality traits and experiences.
• Two: Search and evaluation. Similar to the Howard Sheth model’s “limited
problem-solving” stage, the customer begins to compare different brands here
based on the company’s messaging.
• Three: Purchase decision. The purchase decision will occur after the company
convinces the customer to choose them as their retailer or provider.
• Four: Feedback. During the feedback field, the company will determine whether
it should continue using the same messaging, and the customer will decide
whether they will continue to be receptive to future messages.
 Nicosia model
The Nicosia Model places emphasis on the business first and the
consumer second. It argues that the company’s marketing messages
determines whether customers will buy.
The model is comprised of four “fields”:
•One: The business’ characteristics and the customer’s
characteristics. What does your marketing messaging look like?
And what’s your customer’s perception of that messaging? Are they
predisposed to be receptive to your message? The latter is shaped by
the customer’s personality traits and experiences.
•Two: Search and evaluation. Similar to the Howard Sheth model’s
“limited problem-solving” stage, the customer begins to compare
different brands here based on the company’s messaging.
•Three: Purchase decision. The purchase decision will occur after
the company convinces the customer to choose them as their retailer
or provider.
•Four: Feedback. During the feedback field, the company will
determine whether it should continue using the same messaging, and
the customer will decide whether they will continue to be receptive
to future messages.