Understanding Consumer Behavior

• Consumer behavior involves the study of how individuals, groups, and organizations choose, purchase, use, and discard goods, services, ideas, or experiences to fulfill their needs and desires

Needs, Wants and Motivation

• Needs are basic requirements like food and shelter
• Wants are desires shaped by culture and personality
• Motivation is the driving force that directs behavior towards satisfying needs and wants

Consumer Decision-Making Process

• Need Recognition: Identifying a need or want that requires satisfaction
• Information Search: Seeking information about potential solutions or products to fulfill that need
• Evaluation of Alternatives: Assessing and comparing different options based on gathered information
• Purchase: Making the decision to buy a specific product or service
• Post-Purchase Evaluation: Evaluating satisfaction with the purchase and its impact on future decisions

Business Role

• Consumer behavior helps businesses make informed decisions about product development, pricing, marketing, and distribution
• Consumer behavior analysis allows businesses to identify target markets and customize offers

Consumer Segmentation

• Businesses identify groups with similar traits to develop effective marketing strategies
• Segmentation enhances customer engagement and optimizes resource allocation

Segmentation Types

• Behavioral: Based on purchase patterns, usage, and response to marketing
• Psychographic: Based on lifestyle, values, attitudes, and interests
• Demographic: Based on age, gender, income, education, and occupation
• Geographic: Based on location, climate, and regional preferences

Impact on Product and Marketing

• By understanding consumer needs, preferences, and behaviors, businesses can design and develop products that meet those needs
• Consumer behavior insights help create effective marketing strategies

Customer Retention

• Understanding consumer behavior helps develop strategies to retain customers and build brand loyalty.

Roles in Society

• Consumer behavior influences social trends like sustainability, health, and wellness
• Consumer behavior shapes cultural values like individualism, materialism, and social status
• Consumer behavior has a significant impact on the environment
• Understanding consumer behavior can inform public policy on advertising, product safety, and consumer protection

Studying Consumer Behavior

• Researchers observe consumers in natural or contrived environments to understand their behavior
• Ethnographic research immerses researchers in consumers' daily lives to understand their behaviors and motivations

Test Marketing and Surveys

• Researchers test new products or marketing strategies in controlled environments
• Consumers provide information about attitudes, preferences, and behaviors through questionnaires, interviews, and online surveys.

Recent Trends Affecting Consumers

• Convenience
• Health and Wellness
• Personalization and Influencers
• Home-Centric Living

Factors that Influence Consumer Behavior

• Psychological
• Personal
• Social
• Environmental

Psychological Factors

• Motivation: The driving force that impels consumers to action based on needs and goals
• Perception: How consumers select, organize, and interpret information to form a meaningful picture of the world
• Learning: Changes in behavior arising from experience, which affects responses to marketing stimuli and purchasing decisions

Consumer Attitudes and Beliefs

• Cognitive Component: Beliefs and knowledge about a product influence perceptions
• Affective Component: Emotional feelings toward a product shapes overall attitude
• Conative Component: Behavioral intentions and likelihood of action, reflecting readiness to act

Personal Factors

• Age: Different life stages influence consumer needs and preferences
• Income/Economic Condition: Disposable income affects purchasing power and decision-making
• Occupation: Impacts buying decisions
• Personality changes can influence customer's buying patterns
• Lifestyle: Affects buying behavior and is expressed by customer interests, opinions, and activities

Social Factors

• Family: Shapes values, purchasing habits, and brand preferences, including roles like initiator, influencer, decision maker, purchaser, and user
• Culture: Encompasses shared beliefs, values, and customs that dictate acceptable behaviors and product choices
• Reference Groups: Provide points of comparison and influence through aspirational or membership affiliations, including primary and secondary groups
• Social Class: Tied to factors such as income, occupation, and education

Environmental Factors

-Economic Factors: Economic conditions, like recession or inflation, impact consumer purchasing power and behavior Technological Factors

• Physical Environment: Store layout or website design influences consumer behavior and purchasing decisions