UNDERSTANDING CUSTOMER

BEHAVIOUR
TATTOOS BECOME MAINSTREAM
How customers behave can never be taken for
granted and new trends emerge all the time,
such as the demand for tattoos.
 There are a variety of influences on the
purchasing habits of customers and these are
constantly changing and evolving. As a result,
products that may only recently have been
‘must haves’ quickly go out of fashion to be
replaced by something else.
Successful marketing requires a great
sensitivity to these subtle drivers of
behavior and an ability to anticipate
how they influence demand.
THE DIMENSIONS OF CUSTOMER BEHAVIOUR

• Purchases of pvt customers and organizations

are different
• Consumer purchasing is individual
• B2B purchasing there are 3 major types of
buyer
 Types of B2B purchasing
1. Industrial market concerns those
companies that buy products and
services to help them produce other
goods and services. Industrial goods
include raw materials, components
and capital goods such as
machinery.
2. Reseller market comprises organizations
that buy products and services to resell.
Mail-order companies, retailers and
supermarkets are examples
3. Government market consists of
government agencies that buy products
and services to help them carry out
their activities. Purchases for local
authorities and defence are examples.
Understanding the behaviour of
this array of customers requires
answers to the following
questions
 Who is
important?

What are
How do their choice
they buy? criteria?
CUSTOMERS

Where do When do
they buy? they buy?
The answers to these questions
can be derived from personal
contact with customers and
increasingly, by employing
marketing research.
 Who Buys?
Blackwell, Miniard and Engel decribe five roles
in the buying decision- making process.
1. Initiator: the person who begins the process
of considering a purchase. Information may be
gathered by this person to help the decision.
2. Influencer: the person who attempts to
persuade others in the group concerning the
outcome of the decision. Influencers typically
gather information and attempt to impose
their choice criteria on the decision.
3. Decider: the individual with the power
and/ or financial authority to make the
ultimate choice regarding which product
to buy.
4. Buyer: the person who conducts the
transaction. The buyer calls the supplier,
visits the store, makes the payment and
effects delivery.
5. User: the actual consumer/ user of the
product.
Multiple roles in the buying group
may be assumed by one person.
 PESTER POWER
The expression ‘pester power’ is often used by
advertisers to describe the process by which
children subtly influence or more overtly nag
their parents into buying a product.
• 80% of children aged 3-6 recognize Coca-Cola
logo.
• Tweens- children aged 8-12 account for 60%
of all household expenditure
• Over two-thirds of households buying a new
car are influenced in the decision by their
children.
E.g: Toyota (Australia) includes chickens, puppies
& kittens
• Men now make more than half of
their family’s purchase decisions in
food categories
• Women still purchase majority of
men’s sweaters, socks and sports
shirts
• Also women are big purchasers of
male grooming products
• Joint decision-making is more common when
the household consists of two income-earners
• Most organizational buying tends to involve
more than one individual and is often in the
hands of a decision-making unit (DMU), or a
buying centre. This is not necessarily a fixed
entity and may change as the decision-making
process continues.
 HOW THEY BUY
Need recognition/ problem awareness

Information Search

Evaluation of alternatives

Purchase
PP

Post- Purchase evaluation of decision

 How they buy…
• Organizational buying is typically more
complex and may involve more stages.
• In certain situations some stages will be
omitted e.g: re-ordering photocopying paper
(stages3,4 and 5)
• More complex the item and more expensive
the product the process will take more time
 Need recognition/ problem awareness

• Need recognition may be functional and occur

as a result of routine depletion e.g: food or
unpredictably e.g: breakdown of washing
machine
• Or Consumer purchasing may be initiated by
more emotional or psychological needs e.g:
purchase of a Chanel perfume is likely to be
motivated by status needs rather than by any
marginal functional superiority
 ctd
• Two issues govern the degree to which the
buyer intends to resolve the problem : the
magnitude of the discrepancy between the
desired and present situation, and the relative
importance of the problem
 IMPLICATIONS FOR MARKETING
• Marketing managers must be aware of the
needs of consumers & the problems they face
• Marketers should be aware of need inhibitors
e.g: Test drive a Mac
• Marketing managers should be aware that
needs may arise because of stimulation
 INFORMATION SEARCH
Need recognition/ problem awareness

Determination of specification and quantity of needed item

Search for and qualification of potential sources

Acquisition and analysis of proposals

Evaluation of proposals and selection of supplier(s)

Selection of an order routine

Performance feedback and evaluation

The objective of information search is
to build up the awareness set- that
is, the array of brands that may
provide a solution to the problem.
Evaluation of alternatives & the purchase

Factors that affect involvement:

• Self-image
• Perceived risk
• Social Factors
• Hedonistic influences
 POST-PURCHASE EVALUATION OF THE
DECISION
• The creation of customer satisfaction is the
real art of effective marketing.
• It is common for customers to experience
some post-purchase concerns known as
cognitive dissonance (because of uncertainty
surrounding the making of the rt decision)
 Due to expense of purchase
 Many choices
 Decision is irrevocable
 Purchaser experience of anxiety
 WHAT ARE THE CHOICE CRITERIA
• The various attributes a customer uses when
evaluating products and services are known as
choice criteria
 Choice criteria used when evaluating
alternatives
TYPE OF EXAMPLES
CRITERIA
Technical Reliability, Durability, Performance,
Style/ looks, Comfort, Delivery,
Convenience, Taste
Economic Price, Value for money, Running costs,
Residual value, Life cycle costs
Social Status, Social belonging, Convention,
Fashion
Personal Self- image, Risk Reduction, Morals,
Emotions
Marketing managers need to understand the
choice criteria being used by customers to
evaluate their products and services. Such
knowledge has implications for priorities in
product design, and appeals to use in
advertising and personal selling
INFLUENCES ON CONSUMER PURCHASING
BEHAVIOUR

THE BUYING
SITUATION
PERSONAL SOCIAL
INFLUENCES INFLUENCES
• INFORMATION • CULTURE
PROCESSING • SOCIAL CLASS
• MOTIVATION • REFERENCE
BELIEFS AND CONSUMER GROUPS
ATTITUDE
• PERSONALITY
• LIFESTYLE
• LIFE CYCLE
 THE BUYING SITUATION
3 KINDS OF BUYING SITUATION:
• Extended problem solving
• Limited problem solving
• Habitual problem solving
 The Buying Situation CTD..
Extended problem solving: involves a high degree of
info search & close examination of the alternative
solutions using many choice criteria
• Associated with 3 conditions:
o The alternatives are differentiated and numerous
o There is an adequate amount of time available for
deliberation
o The purchase has a high degree of involvement

Marketers can help in this buying situation by providing

information-rich communications via advertising & the
salesforce
 The Buying Situation ctd..
Limited problem solving: the consumer has
some experience with the product in question
so that information search may be mainly
internal through memory.
• Marketers have some opportunity to affect
the purchase by stimulating the need to
conduct a search and reducing the risk of
brand switching
 The Buying Situation ctd..
Habitual problem solving: is what happens when a
consumer repeat-buys a product while carrying out
little or no evaluation of the alternatives.
• He may recall the satisfaction gained by purchasing a
brand, & automatically buy it again.
• Advertising may be effective in keeping the brand
name in the consumer’s mind & reinforcing already
favourable attitudes towards it.
 PERSONAL INFLUENCES
The six personal influences on consumer
behaviour are:
• Information processing
• Motivation
• Beliefs & attitudes
• Personality
• Lifestyle
• Life cycle
 Information Processing
• Process by which a stimulus is received,
interpreted, stored in memory and later retrieved
• Two key aspects are: perception & learning
• Perception: is the complicated means by which we
select, organize & interpret sensory stimulation
into a meaningful picture of the world. 3
processes used to manage masses of stimuli are
selective attention, selective distortion & selective
retention
 Information Processing..ctd…
• Learning: is the result of information
processing, the term refers to any change in
the content or organization of long-term
memory.
 MOTIVATION
• Motives determine choice criteria
• Motives grouped acc to Maslow
1. Physiological
2. Safety
3. Love
4. Esteem
5. Self-actualization
 BELIEFS AND ATTITUDES
• Belief: a thought that a person holds about
something
• Attitude: overall favourable or unfavourable
evaluation of a product or service
• The consequence of a set of beliefs may be
+ve or –ve attitude towards the product
 PERSONALITY
• Is the sum of the inner psychological
characteristics of individuals, which lead to
consistent responses to their environment
• Brand personality is the characterization of
brands as perceived by consumers
 LIFESTYLE
• Refers to the pattern of living as expressed in a
person’s activities, interests and opinions
• Lifestyle analysis (psychographics) groups
consumers acc to their beliefs, activities,
values and demographic characteristics.
 Seven major lifestyle groups
• The mainstreamers
• The aspirers
• The succeeders
• The transitionals
• The reformers
• The struggling poor
• The resigned poor
 The mainstreamers
• Attitude: conventional, trusting, cautious and
family centered.
• Leisure activities: spectator sports, gardening
• Purchase behaviour: habitual, brand loyal and
in approved stores
 The aspirers
• Attitude: unhappy, suspicious and ambitious
• Leisure activities: trendy sports and fashion
magazines
• Purchase Behaviour: buy fads, impulse
shoppers and engage in conspicuous
consumption
 The succeeders
• Attitude: happy, confident, industrious and
leaders
• Leisure activities: travel, sports, sailing and
dining out
• Purchase decisions: based on quality, status
and luxury
 The transitionals
• Attitude: liberal, rebellious, self-expressive,
intutive
• Leisure activities: unconventional tastes in
music, travel and movies and enjoy cooking,
arts and crafts
• Purchase Behaviour: impulsive and involve
unique products
 The reformers
• Attitude: self-confident and involved, have
broad interests and are issues oriented
• Leisure activities: reading, cultural events,
intelligent games and educational TV
• Purchase Behaviour: they have eclectic tastes,
enjoy natural foods, and are concerned about
authenticity and ecology
 The struggling poor
• Attitude: unhappy, suspicious and feel left out
• Leisure activities: sports, music and television
• Purchase behaviour: tends to be price based
but they are also looking for instant
gratification
 The resigned poor
• Attitude: unhappy, isolated and insecure
• Leisure activities: television is their main
leisure activity
• Purchase Behaviour: is price based, although
they also look for the reassurance of branded
goods
 Life cyle
• Consumer behaviour may depend on the ‘life
stage’ people have reached
• Disposable income and purchase requirement
may vary
 SOCIAL INFLUENCES
• 3 social influences on consumer behaviour
are:
• Culture
• Social class
• Reference groups
 CULTURE
• Refers to the traditions, taboos, values and
basic attitudes of the whole society within
which an individual lives.
• It provides the framework within which
individuals and their lifestyles develop, and
affects consumption.
• Most notable tend- increased
internationalization of cultures
 SOCIAL CLASS
• Social class is largely based on occupation( of
the chief income earner)
• This is one way in which respondents in
marketing research surveys are categorized
and it is usual for advertising media to give
readership figures broken down by social class
groupings
ANALYTICAL OPERATIONAL CATEGORIES OCCUPATIONS
CLASS
1 Higher managerial and professional Employers in large organizations; higher
occupations managerial and professional
2 Lower managerial and professional Lower managerial occupations; higher
occupations technical and supervisory occupations
3 Intermediate occupations Intermediate clerical/ administrative;
sales/ service, technical/ auxiliary and
engineering occupations
4 Small employers and own- account Employers in small, non-professional
workers and agricultural organizations, and
own-account workers
5 Lower supervisory and technical Lower supervisory and lower technical
occupations craft and process operative occupations
6 Semi-routine occupations Semi-routine sales, service, technical,
operative, agricultural, clerical and
childcare occupations
7 Routine occupations Routine sales/ service, production,
technical, operative and agricultural
occupations
8 Never worked and long-term Never worked, long-term unemployed
unemployed and students
 REFERENCE GROUPS
• A group of people that influences an
individual’s attitude or behaviour
• Reference groups can be formal(members of
club) or informal (friends)
• Opinion leaders exert enormous power over
purchase decision