sCONSUMER BEHAVIOUR

WHAT IS CONSUMER BEHAVIOUR?

i. Consumer behavior studies how:
 Individuals
 Groups and
 Organizations
 Select
 Buy
 Use and
 Dispose of
Goods, services, idea or experiences to satisfy their needs and wants.
ii. It refers to the behavior that customers exhibit in
 Searching for,
 Purchasing
 Using
 Evaluating and
 Disposing of
Products and services that they expect will satisfy their needs.
iii. Consumer behaviors studies “ How consumers makes decisions to spend their
available resources i.e.
 Time
 Money
 Effort
On consumption related items
iv. It includes a study of
 What they buy
 Why they buy it
 When they buy it
 Where they buy it
 How often they buy it
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  How often they use it

TYPES OF CONSUMER ENTITIES

The term “consumer” is often used to describe two different types of consumers’ entities i.e.
i. The personal consumer and
ii. The organizational consumers
 The personal consumer buys goods and services for:
- use by the household or
- as a gift for a friend
in each of these cases, the goods are bought for final use by individuals who are referred to as:
- End users or
- Ultimate consumers
 The second category of consumers i.e.” The organizational consumers’ encompass
i. Profit making business
ii. Non- Profit making concerns e.g. government agencies (Local, state and National)
iii. Institutions e.g.
- School
- Hospitals
- Prisons
All these buy products, equipment and services in order to run their operations
Despite the existence of these two categories of consumers, the end-use consumption is perhaps
the most pervasive of all types of consumer behavior, for it involves every individual, of every
age and background, in the role of either buyer or user or both.

WHY STUDY CONSUMER BEHAVIOR?

Reasons why people study consumer behaviors are diverse.
The field of consumer behaviors holds great interest for us as;
- Consumers
- As market and
- As scholars of human behavior.

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 i. As consumers
 We benefit from insights into our own consumption related decisions;
- What we buy
- Why we buy
- How we buy and the
- Promotional influence that persuade us to buy.
 The study of consumer behavior enables us to become better i.e. wiser consumers.
ii. As markers and future marketers,
 It is important for us to recognize why and how consumers make their consumption
decisions for a number of reasons;
a) So as to make better strategic decisions
b) If marketers understand consumer’s behaviors, they are able to predict how
consumers are likely to react to various informational and environmental cues and
are able to shape their marketing strategies accordingly.
c) Marketers who understand consumer’s behavior have greater competitive
advantage in the market place.
d) Customers are the reasons for any business existence since without them a
business cannot exist. Meeting the needs of the customers more effectively than
competitors do is the key to continued profitable existence for any business.
e) It is important that each customer who deals with an organization is left with a
feeling of satisfaction. This may lead to increased sales or willingness to pay
higher prices thus higher profits.
f) Anyone who buys takes a risk. Everyone likes to get value for money. It is
important that marketers help reduce the risk for consumers so that they are more
likely to become regular customers.
g) Loyal customers will support the organization in hard times.
h) Customer’s loyalty is a source of company’s goodwill.
iii. As scholars of human behavior, we are concerned with understanding consumers
behavior with;
 Gaining insights into why individuals act in certain consumption – related ways and
 With learning what internal and external influences compel them to act as they do.

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BUYING ROLES. (Who makes the buying decisions?)
Marketers should identify the buying roles for their products. They should however not that these
roles keep changing hence care should be taken when making their marketing decisions.
They have distinguished five roles that people might play in a buying decision.
i. Initiator – A person who first suggests the idea of buying a particular product or services.
ii. Influencer – A person whose views or advice influence the buying decision
iii. Decider – A person who ultimately determines any part of or the entire buying decision: -
whether to buy, what to buy, how to buy it or where to buy it.
iv. Buyer – the person who makes the final purchase.
v. User- A person who consumers or uses the product.
A marketer needs to identify these roles because they have implications for the design of product
determining the promotion messages and allocating the promotion budget.
dfg
Types of buying behavior.
These are based on the degree of involvement in the purchase and the significant difference
among brands.
i. Complex buying behaviour
Consumers go through this type of behavior when,
- They are highly involved in the purchase and
- Are aware of significant differences existing among brands.
They are highly involved because the product is:
- Expensive
- Bought frequently
- Risky and
- Highly self-expressive.
The customer does not know much about the product category and has much to learn. E.g. when
buying a personal computer some meaning may not come up e.g. disc storage, basic language
etc. In the buying process, the consumer develops beliefs about products, develops attitudes and
comes up with a thoughtful decision.
ii. Dissonance – Reducing buying behaviour.
 The consumer is highly involved in the purchase because

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 - The product is expensive
- Infrequently brought
- Risky and
- Highly self-expensive
 There are little differences in the brands available
 In this case, the buyer will shop around to learn what is available.
 But will buy fairly quickly because the brand difference is not pronounced.
 The consumer goes through the following stages in the purchase process.
- They first act
- Then acquire some belief
- Finally the end up with a set of attitudes
 The buyer primarily respond to
- a good price and
- The conveniences of purchasing at that time or place.
 After purchase, the buyer may experience post-purchase dissonance because of hearing
other things about other similar products elsewhere.

iii. Habitual behaviour.

 Many products are bought out of habit
 They are bought under low consumer involvement and the absence of significant brand
differences. E.g. in the Purchase of bread out of habit. A customer may be loyal to a
particular type of bread, due to loyalty
 These products have:
- Low costs and
- Frequently purchased
iv) Variety – seeking buying behaviour
This is characterized by
 Low consumer involvement and
 Significant brand differences
 Brand switching is generally common here for the sake of variety rather than
dissatisfaction

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  The consumer switches to another brand next time possibly out of boredom.

COGNITIVE DISSONANCE

STAGES IN BUYING THE DECISION PROCESS

Five stage model of buying process
Problem recognition.
 The buying process starts with buyer recognizing a problem or need.
 The need can be triggered by internal or external stimuli.
Marketers need to find out what brought about the need.

Information search
An aroused consumer may or may not search for more information. The following are the
sources of information that a consumer can turn to:-
i. Personal sources (Buyer sources)
This may be from the family, friends, neighbors, acquaintances, etc. These sources may be used
when:-
- Performance risk are high
- The buyer is particularly interested in avoiding mistakes and hence
actively seeks negative or unfavorable information if it is available.
ii. Commercial sources
These include all information sources controlled by the seller. They include:-
- Advertising and
- Personal selling
They are used when:-
- The perceived risk is too low
- Higher cost of using alternative source is not justified.
iii. Public sources
E.g. – mass media and
- Consumer organizations
iv. Experiential sources:-

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E.g. Handling
Examining and
Using the product.
Evaluation of alternatives
The information obtained helps the consumer to clarify and evaluate the alternatives under
consideration:-
i. Various product attributes, e.g. type, shape, appearance, texture, aging cost , color
effectiveness, taste/ flavor, comfort, fit style, safety , quality, e.t.c
ii. Important weights attached to the attributes
iii. The brand image or brand beliefs should also be considered.
iv. How the consumer will arrive at attitudes toward the brand alternatives through some
brand evaluation procedures. These differ among consumers.

Purchase decision
In the decision evaluation stage, the consumer forms preferences among brands in the purchase
choice set.
Purchase decision may be influenced by several factors e.g.
- Attitudes of others
- Unanticipated situational factors e.g. loss of a job, death in the family
and transfer
Four purchasing sub-decisions will be considered:-
- Brand decision
- Quantity decision
- Timing decision
- Payment methods decision.
Post-purchase behavior
After purchasing the product, the consumer may experience some level of satisfaction or
dissatisfaction.
Post –purchase satisfaction
This occurs if the product matches the expectation of the consumer.

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 i. A satisfied consumer will.
- Speak well of a company’s product
- Buy the product again
- Buy other products from the company
- Talk to others about the company’s products.
ii. Post- purchase dissatisfaction
This occurs if the product does not match the expectation of the consumer.
A dissatisfied consumer may:-
- Take legal action
- Seek redress from the company
- Keep quiet
- Talk to others negatively about the company.

Factors influencing buyer behavior

A.Cultural factors
i. Culture
 Culture exerts the broadest and the deepest influence on buyer behavior.
 A child growing up in a society learns the basic set of values, perceptions, preferences
and behaviors through a process of socialization involving the family and other key
institutions.
 Computers to an America child would have a lot of meaning whereas it may be
meaningless to an African child.
Sub-culture
Each culture consists of smaller sub-culture that provide more specific identification and
socialization for its members.
Example include:-
- Ethnicity groups – E.g. Kikuyu, Luo and Luhyas
- Nationality groups – E.g. Kenyans, Ugandans etc. all have distinct tastes
- Religious groups – E.g. Christians, Jews, Muslims, etc. They all have
specific preferences and taste.
- Racial groups – All have distinct culture, beliefs, style and attitudes.

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 - Geographical areas.
ii.Social class
All human societies have a district social stratification, i.e. the social class.
“ Social classes are relatively homogenous and enduring division in a society, which are
hierarchically orders and whose members share similar values, interest and behavior”
Social classes have several characteristics:-
i. Persons within each social class behave alike as opposed to person from the other social
classes.
ii. Person is perceived as occupying superior or inferior positions according to their social
classes.
iii. A person’s social class is indicated by a number of variables e.g. occupation, income,
wealth, education, etc. rather than a single variable.
iv. An individual can move from one social class to another up or down during their
lifetimes.
Social class show distinct products and brand preferences in such areas as clothing, home
furnishing, leisure activities and automobiles. Markets should focus their activities on the right
class.

B. Social factors
A consumer’s behavior is also influenced by social factors such as:
- Reference groups
- Family
- Social roles and statuses
- Opinion leaders
i. Reference groups
Reference groups consists of all groups that have direct (face to face) or indirect
Influence in a person’s behavior
i. Direct influence (Membership groups)
These are groups to which a person belong and interacts.
Some are:
- Primary groups. In which there is fairly continuous interaction e.g.

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 o Family,
o Friends
o Neighbors
o Co-workers.
- Interaction tends to be informal
- Secondary groups. There is less continuous interaction among members
and such interaction tend to be formal E.g.
o Professional groups
o Religious groups
o Union groups
ii. Indirect Influence (Aspiration groups)
People also belong to groups to which they are not members. Groups to which a person aspires to
belong to are known as inspirational groups. E.g.
Opinion Leaders
These are people who offer advice or information about a specific product or groups of products
and can prescribe the types of products to be bought E.g.
o Doctors prescribe medicines/drugs
o Teachers prescribe textbooks.
How do references groups influence their members?
Marketers should try to identify references for their target customers because they influence
them in three ways.
i. They expose an individual to new behavior and lifestyle
ii. They influence a person’s attitudes and self –concept since he/she desires to “fit in”
iii. They create pressure for conformity that may affect the person’s actual products and
brand choice.
ii.Family
Family members constitute to the most influential primary reference groups shaping a buyer
behavior. Two families can be distinguished:
- Family of orientation
- Family of procreation

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 i. Family Orientation
This constitutes of one parent. From parents, one acquires an orientation towards
o Religions
o Politics
o Self-worth
o Love etc.
Parents thus influence the behavior of the buyer unconsciously.
ii. Family of procreation
This constitutes of one’s spouse and children
Husband-wife involvement varies widely by product category.
 The wife traditionally is the chief purchaser of food, sundries and staple clothing
items.
 But with the increased number of working wives, husbands are doing more
family shopping
 Husbands have a great say in things like TV, automobiles, life insurance, etc.
The marketer has to determine the buying roles of each member as these have an influence in the
marketing strategy to be adopted.
iii.Roles and statuses.
 A role consists of the activities that a person is expected to perform according to the
persons around him / her.
 Each role carries with it a status reflecting the esteem accorded to its by the society. E.g.
o A manager has more status than an office clerk
 People choose products that reflect their roles and statues in a society e.g.
o Executives drive posh cars, wear expensive tailored suits, drink
champagnes etc.
Marketers should be aware of such roles and statuses and offer products accordingly.

C. Personal factors
A buyer’s decision is also influenced by his/her personal factors of characteristics such as:
i. Age and stage in family life cycle
ii. Occupation and economic circumstances

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 iii. Lifestyle and values
iv. Personality and self-concept.
Age
 People change the goods and services they buy over their lifetime.
 They eat baby foods in their earlier years and most food in their growing and mature
years
 Consumption is also shaped by the family life cycle.
Occupation
A person’s occupation also influence his/her consumption patter,
A blue-collar workers will buy works clothes, work shoes, lunchbox, etc.
A company president will buy expensive suits, air travels etc.
 A marketer should try to identify occupational groups that have above average interested
in their products and services.
 A company can even specialize in products for certain occupational groups.
Economic circumstances
 Product choice is greatly affected by ones economic circumstances.
 People’s economic circumstances consist of.
o Their spendable income (Level stability and time pattern)
o Saving
o Assets
o Debts
o Borrowing power and
o Attitude toward spending verse savings among others
Marketing of income-sensitive goods pay constant attention to trends in
o Personal incomes
o Saving and
o Interest rates
 If economic indicators point to a recession, markets can take steps to:-
o Redesign
o Reposition and

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 o Re-price their products so that they continue to offer value to target customers.

Lifestyle
 People coming from same sub-culture, social class and occupation may lead different
lifestyles
“A person’s lifestyle is the person’s pattern of living in the world as expressed in the person’s
activities, interests, opinions and lifestyle portrays the whole person interacting with his/her
environment”
Some lifestyle patterns of people may possess include-:
o Those interested in change
o Followers
o Traditionalists
o Contented
o Under achievers etc.
Personality and self-concept
Each person has a distinct personality that influences his/ her environment personality is usually
described in term of
o Self confidence
o Dominance
o Autonomy
o Difference
o Sociability
o Adaptability and
o Defensiveness.
Personality type may have a strong correlation with certain product brands (Self-Concept and
Self –Image)
How one view him/ herself will influence what he/she will buy as opposed to the ideal self
concept (How she thinks other view her).
D. Economic Factors

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Consumer behaviour is influenced largely by economic factors. Economic factors that influence
consumer behaviour include:-
a) Personal Income,
b) Family income,
c) Income expectations,
d) Savings,
e) Liquid assets of the Consumer,
f) Consumer credit,
g) Other economic factors.
a) Personal Income
The personal income of a person is determinant of his buying behaviour. The gross personal income of a
person consists of disposable income and discretionary income. The disposable personal income refers to
the actual income (i.e. money balance) remaining at the disposal of a person after deducting taxes and
compulsorily deductible items from the gross income. An increase in the disposable income leads to an
increase in the expenditure on various items. A fall in the disposable income, on the other hand, leads to a
fall in the expenditure on various items. The discretionary personal income refers to the balance
remaining after meeting basic necessaries of life. This income is available for the purchase of shopping
goods, durable goods and luxuries. An increase in the discretionary income leads to an increase in the
expenditure on shopping goods, luxuries etc. which improves the standard of living of a person.
b) Family income
Family income refers to the aggregate income of all the members of a family. Family income influences
the buying behaviour of the family. The surplus family income, remaining after the expenditure on the
basic needs of the family, is made available for buying shopping goods, durables and luxuries.
c) Income Expectations
Income expectations are one of the important determinants of the buying behaviour of an individual. If he
expects any increase in his income, he is tempted to spend more on shopping goods, durable goods and
luxuries. On the other hand, if he expects any fall in his future income, he will curtail his expenditure on
comforts and luxuries and restrict his expenditure to bare necessities.
d) Savings
Savings also influence the buying behaviour of an individual. A change in the amount of savings leads to
a change in the expenditure of an individual. If a person decides to save more out of his present income,
he will spend less on comforts and luxuries.
e) Liquid assets

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Liquid assets refer to those assets, which can be converted into cash quickly without any loss. Liquid
assets include cash in hand, bank balance, marketable securities etc If an individual has more liquid
assets, he goes in for buying comforts and luxuries. On the other hand, if he has less liquid assets, he
cannot spend more on buying comforts and luxuries.
f) Consumer credit
Consumer credit refers to the credit facility available to the consumers desirous of purchasing durable
comforts and luxuries. It is made available by the sellers, either directly or indirect у through banks and
other financial institutions. Hire purchase, installment purchase, direct bank loans etc are the ways by
which credit is made available to the consumers. Consumer credit influences consumer behaviour. If
more consumer credit is available on liberal terms, expenditure on comforts and luxuries increases, as it
induces consumers to purchase these goods, and raise their living standard.
g) Other economic factors
Other economic factors like business cycles, inflation, etc. also influence the consumer behaviour.

E. Psychological Factors
i. Motivation
A person’s buying behavior is also influenced by psychological factors.
Needs and motives
 A human need is a state of felt deprivation of some basic satisfaction.
 A motive is an inner state that energizes behavior or a motive is an inner state that directs
us towards the goals of satisfying a felt need.
 I.e. to take action to reduce a state of tension and to return it to a condition of
equilibrium.
 Maslow’s theory provides a useful guidance’s for marketers
 It indicates which type of needs might be more important to specific customers
 Marketers can fit product and messages to particular targets using his hierarchy.

ii.Perception
A motivated person is ready to act. How she/she actually does thus is influenced by his/her
perception. This is the process by which we attribute meaning to incoming stimuli received
through our five senses.

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  Stimulus factors – Characteristics of physical objects – e.g. size , colour, weight or
weight or shape.
 Individual factor – characteristics of individuals

“ Perception is the process by which an individual selects, organizes interprets information

inputs to create a meaningful picture of the world”

People can emerge with different perceptions of the same objects because of three perceptual
processes, i.e., Selective attention, selective distortion and selective retention. As a result they
may not necessarily see or hear the message that markers want to send.
Marketers must be careful to take these perceptual process into account when designing their
marketing campaigns.
1. Selective attention
 People are exposed to a lot of stimuli daily
 Because a person cannot possibly attend to all of these stimuli, most of these stimuli have
to be screened out – a process called selective attention
 Finding have revealed that,
o People are more likely to notice stimuli that they anticipate
o People are more likely to notice stimuli that relate to a current need
o People are more likely to notice stimuli whose deviations are large in relation to
normal sizes of the stimuli.
 Marketers have to work hard to attract customers’ notice. They can do this by:
o Having larger size advertisements
o Use of bold colors and
o Providing contract to their (adverts) surrounding that are more likely to be
noticed.
2. Selective distortion
This is people’s tendency to twist information into personal meaning and interpret information in
a way that will support rather than challenges their preconception
Unfortunately, there is not mush that marketers can do regarding selective distortion.

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3. Selective retention
People will tend to forget must that they learn but will tend to retain information that supports
their attitudes and belief. This is referred to as selective retention.

E.g.
If an individual observes some driving a Mercedes Benz, he might perceive the drivers to be
someone of wealth, power and influence.
Note: Marketers are interested in perception because it involves what a customer believes in,
e.g. consumers believe that beer brands – White cap , Tusker and Export are different yet experts
say they are the same . This in turn influences what they buy.

iii. Attitudes and beliefs

This is a learnt tendency to respond to a product, brand or company in a way that is consistently
favorable or unfavorable
The more favorable a consumer’s attitude towards a product is, the higher the usage rate and vise
versa.
 Marketers are interested in finding out customer’ attitude towards their product.
- How to change unfavorable attitudes, (e.g. promotional techniques)
- And how to maintain positive ones
- They use marketing research to discover prevailing attitudes.
iv. Learning
 Is any change in an individual’s behaviour resulting from practice, experience or
mental association.
 Consumer learning comprises the initial task of learning how to purchase as well as
constantly adjusting taste/preference and practice as new products and services are
introduced and retail outlets evolve.
To the marketers
 Learning is faster and more complete when people are actively involved. Marketers can
involve people in many ways, for example in giving free samples, offering test drives for
cars on sale.

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 Consumers learn best when they are experiencing intense need. It cannot be conditioned
to them.

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